Five thousand tickets are sold at $1 each for a charity raffle. Tickets are to b

Question

Five thousand tickets are sold at $1 each for a charity raffle. Tickets are to be drawn at random and monetary prizes awarded as follows 1 prize of $800, 3 prizes of $200, 5 prizes of $40, and 20 prizes of $5. What is the expected value of this rafle if you buy 1 ticket? a. Let X be the random variable for the amount won on a single raffe ticket Complete the payof table for the random variable X Enter the net amount won in decreasing order) Type probabilities as decimals ) b. Em- Round to the hundredths place if necessary ) nver in each of the answer boxes Type here to search 2 3 4 5 6 Q W E R T Y U A S

Explanation / Answer

The probability distribution for this raffle will be:

Hence,

Expected value of raffle

= 799*(1/5000) + 199*(3/5000) + 39*(5/5000) + 4*(20/5000) - 1*(4971/5000)

= - $0.66

Amount Probability $800 - $1 = $799 1/5000 $200 - $1 = $199 3/5000 $40 - $1 = $39 5/5000 $5 - $1 = $4 20/5000 - $1 1 - 29/5000 = 4971/5000

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