Expected value is a statistical concept that represents the average outcome of a random variable over a large number of trials. It is calculated by multiplying each possible outcome by its probability and adding all of these values together.
Expected value allows us to make informed decisions based on probabilities. It helps us understand the potential outcomes and risks associated with a particular situation or event.
Expected value is calculated by multiplying each possible outcome by its probability and adding all of these values together. This formula can be written as E(x) = Σx * P(x), where x represents the possible outcomes and P(x) represents the probability of each outcome.
Expected value is an average of all possible outcomes, so it may not always match the actual outcome. However, over a large number of trials, the expected value will converge to the actual outcome.
Yes, expected value can be negative if the possible outcomes include negative values. It is simply a mathematical calculation and does not necessarily reflect the actual outcome.