Question

for the computer to grade this one correctly make sure that your x values are from smallest to largest.
b) what are your expected winnings?
round final answer to 2 decimal places. put correct units in the second box.
c) which of the following is the correct interpretation of the expected winnings?
select an answer

Explanation:

Step1: Recall expected - value formula

The formula for the expected value of a discrete random variable $X$ is $E(X)=\sum_{i}x_ip_i$, where $x_i$ are the possible values of $X$ and $p_i$ are their corresponding probabilities.

Step2: Identify $x_i$ and $p_i$ values

We have $x_1 = 2100$, $p_1=0.0001$, $x_2=- 1$, $p_2 = 0.9999$.

Step3: Calculate the expected value

$E(X)=x_1p_1 + x_2p_2=(2100\times0.0001)+(-1\times0.9999)$.
First, calculate $2100\times0.0001 = 0.21$.
Then, calculate $-1\times0.9999=-0.9999$.
Now, $E(X)=0.21-0.9999=- 0.7899\approx - 0.79$.

Answer:

-0.79