Question

A raffle is being held at a benefit concert. The prizes are awarded as follows: 1 grand prize of $8,900.00, 3 prizes of $680.00, 8 prize of $95.00, and 15 prizes of $25.00. Suppose 15000 raffle tickets are sold, if you buy one ticket for $2.00 then what is your expected value for this raffle?

Answer 1

Answer:

The expected value of the ticket bought in the raffle draw will be $8.04

Explanation:

The total raffle sold is 15000 at $2 per ticket

The total value of the 15000 tickets will be = $2 * 1500 = $3000

what percentage is $2 in $3000

= 2/3000 * 100

= 0.0006 * 100 = 0.0666%

The total price money to be won will be

1 grand prize = $8900

3 prizes = 3 * $680 = $2040

8 prizes = 8 * $95 = $760

15 prizes = 15 * $25 = $375

total prize money = 8900 + 2040 + 760 + 375 = $12075

therefore the value of the one ticket bought will be

0.0666% of $12075 = $8.04

Answer 2

Answer:

The expected value of raffles will be - $1.199.

Explanation:

A raffle is being held at a benefit concert.

The prizes awarded are: 1 grand prize of $8,900.00, 3 prizes of $680.00, 8 prize of $95.00, and 15 prizes of $25.00.

15000 raffle tickets are sold. A person buys one ticket for $2.

Expected Value of raffle for that person

=$[ \ 8,900\ \times\ (1/15000)\ +\ \ 680\ \times\ (3/15000)\ +\ \ 95\ \times\ (8/15000)\ +\ \ 25\ \times\ (15/15000)]\ -\ \ 2$

= $(0.59 + 0.136 + 0.050 + 0.025) - $2

= $0.801 - $2

= - $1.199