It costs $50 to bet on a pig race. The pig has a 1/10 chance of winning and a 1/8 chance of placing 2nd or 3rd. You win $200 if the pig wins, $50 if the pig gets 2nd, and $20 if the pig gets 3rd. What is the expected net gain from a pig race?
So,
50 is the cost of the bet
Thus,
Expected gain = 200 * 1/10 + 50 * 1/8 + 20 * 1/8 - 50
So,
Expected gain = -21.25
So, overall loss.
Question 6 Write the correct values in the boxes. For this question, working is not required and will not be marked. Two of many kinds of bets you can make on a horse race are Win' and 'Place'. In each of these you nominate a horse, say 'Neddy', pay some money (your 'stake) and maybe get some money back (your 'payout'). The payout, if paid, is stakexodds, where 'odds is a number greater than 1 specified by the betting agency....
Question Write the correct values in the boxes. For this question, working is not required and will not be marked Two of many kinds of bets you can make on a horse race are ‘win, and Place. In each of these you noininate往horse, say 'Neddy', pay some money (your ‘stake') and maybe get some money back (your 'payout'). The payout, if paid, is stakexodds, where 'odds is a number greater than 1 specified by the betting agency. The odds number...
Consider a bet where you have 50% chance of winning $40, a 30% chance of winning $60, and a 20% chance of winning $150 a. What is the expected payoff of this bet? b. What is the value of the bet to someone with log utility and an initial wealth of $100? c. Is the value of the same bet any different to someone who also has log utility but an initial wealth of $200?
Suppose you make a dollar bet on a game in which there is a 1 in 5 chance to win. If you win, you win two dollars. On average, you will lose playing this game and each play costs you _______ cents. If you play 200 times, you can expect to lose around _______ dollar .You play roulette betting one dollar on the number 5 each time. The bet pays 35 to 1. You have a 1 in 38 chance to...
A game has an expected value to you of $1700. It costs $1700 to play, but if you win, you receive $100,000 (including your $1700 bet) for a net gain of $98,300. What is the probability of winning?
A game has an expected value to you of $2000. It costs $2000 to play, but if you win, you receive $100,000 (including your $2000 bet) for a net gain of $98,000. What is the probability of winning? Would you play this game? Discuss the factors that would influence your decision. The probability of winning is (Type an integer or a decimal.)
1. Consider a bet with 2.1.1 odds. This means that if you wager $1, you get back $2.10 if you win and $0 if you lose. Assume you start with $1 and place a single $1 bet. Let the RV X denote the change in your final wealth, i.e., P(X € (-1,1.1}) = 1. (a) (2 points) If the probability of winning is 45%, find your expected change in wealth E(X). (b) (2 points) If the probability of winning is...
In the game of roulette, a player can place a $10 bet on the number 16 and have a 1/38 chance of probability chance of winning. If the metal balls lands on 16, the player gets to keep the $10 paid to play the game and the player is awarded an additional $350. Otherwise, the player is awarded nothing and the casino takes the takes the player's $10. What is the expected value of the game to the player? If...
A bet on "black" in Roulette has a probability of 18/38 of winning. If you win, you double your money. You can bet anywhere from $1 to $100 on each spin. a. Suppose you have $10, and are going to play until you go broke or have $20. What is your best strategy for playing? Explain using information you learned in this module's material, such as expected value. b. Suppose you have $10, and are going to play until you...
In the game of roulette, when a player gives the casino $1 for a bet on the number 24, the player has a 37/38 probability of losing $1 and a 1/38 probability of making a net gain of $35. (The prize is $36, but the player's $1 bet is not returned, so the net gain is $35.) If a player bets $1 that the outcome is an odd number, the probability of losing $1 is 20/38 and the probability of...