Question

A person places a bet on the coin toss at the start of the Super Bowl. If the coin comes up HEADS you WIN $100. If the coin comes up TAILS you LOSE $110. What is the person's expected value of making this bet

Answer 1

Answer:

- 5

Step-by-step explanation:

Probability of a coin toss : (H, T)

With probability of 0.5 each

X : ____100 ____ - 110

P(x) :___ 0.5 ____ 0.5

Expected value ; E(X) = ΣX*p(X)

E(X) = (100 * 0.5) + (-110 * 0.5)

E(X) = 50 - 55

E(X) = - 5

Expected value = - 5