A person is trying to decide if they should buy a lottery ticket. The ticket costs $1.00. If the ticket is a winner, the prize would be $10,000. Knowing that winning $10,000 is not a certain outcome (state of nature), the person finds that the probability of winning is 0.0009. Based on this information, the following payoff table can be constructed. What is the probability of losing $1.00?

Question

A person is trying to decide if they should buy a lottery ticket. The ticket costs $1.00. If the ticket is a winner, the prize would be $10,000. Knowing that winning $10,000 is not a certain outcome (state of nature), the person finds that the probability of winning is 0.0009. Based on this information, the following payoff table can be constructed.  What is the probability of losing $1.00?

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The Answer of A person is trying to decide if they should buy a lottery ticket. The ticket costs $1.00. If the ticket is a winner, the prize would be $10,000. Knowing that winning $10,000 is not a certain outcome (state of nature), the person finds that the probability of winning is 0.0009. Based on this information, the following payoff table can be constructed.  What is the probability of losing $1.00?

A Person Is Trying to Decide If They Should Buy