Determine expected value of each winnings

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Homework Help Overview

The discussion revolves around determining the expected value of winnings in a raffle scenario organized by a charitable organization. Two cases are presented, differing in ticket sales and price, with the goal of assessing profitability based on expected value.

Discussion Character

  • Exploratory, Assumption checking

Approaches and Questions Raised

  • Participants explore the concept of payout, questioning whether the $500 trip is the total payout. They discuss how to calculate expected returns based on ticket price and chances of winning.

Discussion Status

The conversation is ongoing, with participants clarifying assumptions about payouts and discussing how to approach the expected value calculations. There is an exchange of ideas regarding the relationship between ticket price, number of tickets sold, and expected winnings.

Contextual Notes

Participants are considering the implications of different ticket sales and prices on expected value calculations, and there is an emphasis on understanding the payout structure and odds involved in the raffle.

Kristinanne
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1. Homework Statement [/b]

A charitable organization is raffling a trip worth $500 to raise money and needs to decide which of the following scenarios would be the most profitable based on expected value of the proposed game.

Case A: 3,000 tickets are sold at $1.00 each.

Case B, 2,000 tickets are sold at $2.00 each.

1. Determine the expected value for the winnings of the players in Case A.
2. Determine the expected value for the winnings of the players in Case B.



Homework Equations





The Attempt at a Solution



To do this, wouldn't I have to know what the payout is?
 
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You don't think the payout is the $500 trip?
 


I was thinking that. That would make a and b $500.00 then correct?
 


That would be the total payout for the raffle.

For each dollar though what is the expected return to each ticket holder taking into account their chance of winning?
 


For instance if I buy a ticket for $1 in a lottery with a 1:1,000,000 chance of winning - 1M tickets sold - then my expected winning is $1 return.

I only have one chance of winning ... but if I do I get $1,000,000 right?
 

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