Suppose a lottery ticket costs $1 and the probability that a holder will win nothing is 99.9%.What must the jackpot be for this to be a fair bet?
A)10
B)100
C)1,000
D)10,000

Question

Quizplus · Accepted Answer

For a fair bet, the expected value should be equal to the cost of the ticket. With a 0.1% chance of winning, the jackpot must be $1,000 to make the expected value $1 (0.001 * $1,000 = $1).

Suppose a Lottery Ticket Costs $1 and the Probability That