Question

At a raffle, 1500 tickets are sold at $2 each for four prizes of $500, $250, $150 and $65. You buy two tickets. What is the expected value of your gain?

Answer 1

This can be solve by just knowing what is amount that is going to be yours and the amount that you will need to give for the prize. So the expected value of your gain is

[$2/ ticket (1500 tickets)] – ( $500 + $250 + 150 + $650) = $2035 is the expected gain