A ticket for a lottery costs $1. With probability 0.0000001, you win 2 million dollars ($2,000,000), and
Question:
A ticket for a lottery costs $1. With probability 0.0000001, you win 2 million dollars ($2,000,000), and with probability 0.9999999 you win nothing. Let y denote the winnings from buying one ticket. Construct the probability distribution for y. Show that the mean of the distribution equals 0.20, corresponding to an expected return of 20 cents for the dollar paid.
Fantastic news! We've Found the answer you've been seeking!
Step by Step Answer:
Related Book For
Statistical Methods For The Social Sciences
ISBN: 9781292220314
5th Global Edition
Authors: Alan Agresti
Question Posted: