Learning Goal
Part of: Weigh outcomes of a decision using expected values — 2 of 2 group items
Evaluate and compare strategies using expected values
Lesson plan for this standard
Objectives, pacing, and practice — built from this lesson’s brief. Copy it field by field into your template.
Open the lesson plan →**HSS.MD.B.5.b**: Evaluate and compare strategies on the basis of expected values. For example, compare a high-deductible versus a low-deductible automobile insurance policy using various, but reasonable, chances of having a minor or a major accident.
**HSS.MD.B.5**: (+) Weigh the possible outcomes of a decision by assigning probabilities to payoff values and finding expected values.
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HSS.MD.B.5.b: Evaluate and compare strategies on the basis of expected values. For example, compare a high-deductible versus a low-deductible automobile insurance policy using various, but reasonable, chances of having a minor or a major accident.
HSS.MD.B.5: (+) Weigh the possible outcomes of a decision by assigning probabilities to payoff values and finding expected values.
What you'll learn
- Model each of two or more competing strategies as a payoff or cost distribution
- Compute the expected value (expected cost or expected payoff) of each strategy
- Compare the strategies and recommend one based on expected value, stating whether lower or higher is better
- Perform a sensitivity analysis: recompute the comparison under different reasonable probabilities and find the break-even probability where the recommendation changes
- Explain that expected value is the primary criterion while risk tolerance can justify a different choice
Slides
Interactive presentations perfect for visual learners • 2 slide decks
Slide Video
Watch narrated slides play like a video lesson • Narrated slide playback
Task-sets
Learning resource • 1 task-sets