Engineering Board Exam Reviewer · Odds and Mathematical Expectation · medium

A game pays P100 if you roll a 6 on a single die, and nothing otherwise. If it costs P20 to play, find the expected net gain or loss per play.

1. -P3.33 (a loss)
2. P16.67 (a gain)
3. -P16.67
4. P3.33

Answer

A. -P3.33 (a loss)

Solution

E[ payout]=100≤ft(1/6 )=16.67. Net expected value =16.67-20=-3.33 (an expected loss of P3.33).

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