What are some prizes from Prize Rebel?

Ten thousand raffle tickets are being sold for $2 each. Three prizes will be awarded, one grand prize of $1000?

• Ten thousand raffle tickets are being sold for $2 each. Three prizes will be awarded, one grand prize of $1000 and 2 consolation prizes of $500 each. Each of the 10,000 tickets has an equal chance of winning one of the 3 prizes. Your friend purchases 1 ticket. Please show how you get the answer. A) Determine the probability your friend winning the $1000 prize. B) Determine the probability your friend will win 1 of the $500 prizes C) Determine the probability your friend not winning a prize D) Determine the expected value for the ticket purchased by your friend

• Answer:

  If you're asking for his EXPECTED EARNINGS, then it is computed as follows: a) His chance of winning the grand prize is 1/10000. His earning then would be 1000 - 2 = $998. b) His chance of winning $500 is 2/10000, and his earning then would be 500 - 2 = $498. c) His chance of losing (or not winning any) is 9997/10000. He stands to lose -$2 in that case. d) His expected earnings is then . Thus he stands to lose $1.80 on the average. E(X)=∑X*P(X) =998(1/10000)+498(2/10000)+-2(9997/10000... = .0998 + .0996 -1.9994 = -$1.80