Expected Value Quiz

Given the probability model in the table below, what is the expected value of the random variable?
  X        50          20        5
P(X)     0.1         0.3      0.6

• 14
• 4.67
• 5
• 7.5

If the expected value is negative, are you expected to win?

• yes
• no

A coin is flipped 3 times. If you get tails once you get $5, tails twice you get $15, and tails on all three flips you get $40. What is the expected amount of money you will get?

• $12.50
• $5
• $7.50
• $10

Suppose you buy a ticket for $6 out of a lottery of 1000 tickets where the prize for the one winning is to be $800. How much money do you take home (after paying for it)?

• $800

• -$6.50

• -$6

• -$5.20

Given the probability model in the table below, what is the expected value of the random variable?
  X        50          20        5
P(X)     0.1         0.3      0.6

• 14
• 4.67
• 5
• 7.5

In a certain community, 30% of households have 1 child, 43% have 2 children, and 27% have 3 children. If a household is selected at random, what is the expected number of children in that household? HINT: A Probability table may be helpful.

• 2.00
• 2.13
• 1.97
• 1.27

If the expected value is positive, are you expected to win?

• yes
• no

Number of Thunderstorms during August
Number of Storms    0     1      2      3
Probability               0.2   0.2   0.4   0.2
How many storms should we expect in August?

• 1.8
• 2.0
• 1.6
• 2.2

A stockbroker estimates that at the end of the year, there is a 40% chance a stock will be worth $50, a 35% chance it will be worth $60 and a 25% chance it will be worth $70.
What expected value does this broker assign to this stock's end-of-the-year price?

• $58.50
• $60.00
• $62.50
• $65.00