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Chapter 6 Review Homework Question 6
Chapter 6 Review Homework
6. For a multistate lottery, the following probability distribution represents the cash prizes of the lottery with their corresponding probabilities. Complete parts (a) through (c) below.
(a) If the grand prize is $14,000, 000, find and interpret the expected cash prize. If a ticket costs $1, what is your expected profit from one ticket?
What is the correct interpretation of the expected cash prize?
The expected profit from one $1 ticket is
(b) To the nearest million, how much should the grand prize be so that you can expect a profit?
(c) Does the size of the grand prize affect your chance of winning? Explain.
- No, because the expected profit is always $0 no matter what the grand prize is.
- Yes, because your expected profit increases as the grand prize increases.
- No, because your chance of winning is determined by the properties of the lottery, not the payouts.