If someone offers you a lottery ticket that has a 25 percent chance of winning $100, a 50 percent chance of winning $200, and a 25 percent chance of winning $1,000, what is the expected value of that lottery ticket?

Question

Quizplus · Accepted Answer

The expected value is calculated by multiplying each outcome by its probability and summing the results: (0.25 * $100) + (0.50 * $200) + (0.25 * $1,000) = $25 + $100 + $250 = $375.

If Someone Offers You a Lottery Ticket That Has a 25