Suppose a casino is offering a game of chance where Ricardo can bet $6 on the flip of a fair coin.If the casino employee flips tails,Ricardo loses the $6 that he bet.If the casino employee flips heads,Ricardo receives a payout of $11 (the $6 he originally bet plus another $5).If Ricardo sits in the casino and plays this game 1,000 times consecutively over a period of 12 hours,he
A) will likely end up with less money than he started with.
B) will likely end up with more money than he started with.
C) will likely end up with the same amount of money that he started with.
D) is equally likely to end up with more money or less money than he started with.
E) will definitely end up with less money than he started with.

Question

Quizplus · Accepted Answer

This is a game of chance, and the odds are against Ricardo. Each time he plays, the probability of him losing his bet is 50%, while the probability of him winning is also 50%. However, the payout for winning is not enough to offset the losses from losing.

On average, Ricardo can expect to win $5 every 2 games he plays ($11 for 1 win minus $6 for 1 loss), which means he will lose $1 for every 2 games he plays. Over the course of 1,000 games, he can expect to lose $500 ($1 loss for every 2 games played, times 1,000 games).

Therefore, it's likely that Ricardo will end up with less money than he started with after playing this game 1,000 times.

Suppose a Casino Is Offering a Game of Chance Where