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In a lottery, a ticket costs $3, and the jackpot is worth $250000. In all, 100000 tickets are sold, one ticket is randomly drawn, and the winner is awarded the jackpot. What are the expected winnings in dollars of buying one ticket (including the cost of the ticket)?

Jeff123  Sep 22, 2017
 #2
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Expected value =

 

Amt spent * (probability of losing)  +  Jackpot * (probability of winning)  =

 

-3 * (99,999/100000) +   250,000* (1/100000)  ≈  -$0.50

 

 

 

  

CPhill Sep 1, 2017

Guest Sep 22, 2017

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