Help statisitics problem, show steps please. 8. Prizes and the chances of winnin

Question

Help statisitics problem, show steps please.

8. Prizes and the chances of winning in a sweepstakes are given in the table below Prize $15,000,000 $550,000 $25,000 $5,000 $300 A watch valued at $65 Chances 1 chance in 400,000,000 1 chance in 200,000,000 1 chance in 80,000,000 1 chance in 5,000,000 1 chance in 100,000 1 chance in 8,000 (a) Find the expected value (in dollars) of the amount won by one entry (b) Find the expected value (in dollars) if the cost of entering this sweepstakes is the cost of a postage stamp (34 cents)

Explanation / Answer

a) from above expected value =$ 0.05

b) epxected value =prize -cost =$ 0.05 -$0.34 =$ -0.29

prize(x) chance(P(x) xP(x) 15000000 0.0000000025 0.0375 550000 0.000000005 0.00275 25000 0.0000000125 0.000313 5000 0.0000002 0.001 300 0.00001 0.003 65 0.000125 0.008125 total 0.052688

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