In a game, you win 70 dollars with probability 20% and 25 dollars with probability 30%. What is the expected value?

**Choice B is the best answer.** E = 70(0.2) + 25(0.3) = 14 + 7.5 = 21.5 dollars

**Choice B is the best answer.** E = 70(0.2) + 25(0.3) = 14 + 7.5 = 21.5 dollars

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Set 3: Probability (Advanced)

Explanation

Answer: B

PROBLEM

In a game, you win $70 with probability 20% and $25 with probability 30%. What is the expected value?

A.

26.5

B.

21.5

✓ Correct

C.

16.5

D.

43

Choice B is the best answer. E = 70(0.2) + 25(0.3) = 14 + 7.5 = $21.5

Why others are wrong:

A: 26.5 is incorrect because it does not satisfy the equation.

C: 16.5 is incorrect because it does not satisfy the equation.

D: 43 is incorrect because it does not satisfy the equation.