question archive The following notice appeared in the golf shop at a Myrtle Beach, South Carolina, area golf course
The following notice appeared in the golf shop at a Myrtle Beach, South Carolina, area golf course
Subject:FinancePrice:3.87 Bought7
The following notice appeared in the golf shop at a Myrtle Beach, South Carolina, area golf course.John Underpar buys a ticket.
a. What are Mr. Underpar's possible monetary outcomes?
b. What are the probabilities of the possible outcomes?
c. Summarize Mr. Underpar's "experiment" in a probability distribution.
d. What is the mean or expected value of the probability distribution? Explain your result.
e. If all 80 tickets are sold, what is the expected return to the Club?
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Answer:
a. Either wins the driver ($300 - 5 =295 worth) or worthless ticket (worth -$5).
b. 79/80 is the probability of getting nothing and 1/80 is the probability of winning.
c. outcome Probability
295 1/80=0.0125
-5 79/80= 0.9875
d. [$0(79/80)+$300(1/80)] - 5=-$1.25
e. golfer loses an average of 1.25 and the other course gains 100 80(1.25)=100
