At a fair carnival roulette wheel,a player can either win $10,$30,or $80.If the player were to be made indifferent between playing the game or not,how much should the owner charge him?
A)$30
B)$40
C)$50
D)$80

Question

​At a fair carnival roulette wheel,a player can either win $10,$30,or $80.If the player were to be made indifferent between playing the game or not,how much should the owner charge him?
A)​$30
B)$40
C)$50
D)​$80

Quizplus · Accepted Answer

To find how much the owner should charge the player to make him indifferent, we need to calculate the expected value of the game. 
The expected value is found by multiplying the probability of each outcome by its corresponding payout and summing the results: 
E(X) = (1/3)*$10 + (1/3)*$30 + (1/3)*$80 = $40 
Therefore, the owner should charge the player $40 to make him indifferent between playing the game or not. 
Among the given choices, the closest to $40 is option B ($40).

​At a Fair Carnival Roulette Wheel,a Player Can Either Win

At a Fair Carnival Roulette Wheel,a Player Can Either Win