Back to Evaluate and compare strategies using expected values — Problem 2 · Task Set 32

Exercises: Evaluate and Compare Strategies Using Expected Values

Work through each section in order. For every comparison, FIRST state the direction: an expected COST means lower is better; an expected PAYOFF means higher is better. Model each strategy as its own distribution, compute its expected value, then compare the totals. For insurance problems, remember expected cost = premium + expected out-of-pocket. Show your arithmetic.

Grade 11·22 problems·~35 min·Common Core Math - HS Statistics and Probability·standard·hss-md-b-5b

Work through problems with immediate feedback

Warm-Up: Direction and Single-Option Expected Value

These problems review computing one expected value and stating the cost/payoff direction.

A prize wheel costs $\text{\char"0024}5$ to spin. It pays $\text{\char"0024}20$ with probability $0.3$ and $\text{\char"0024}0$ with probability $0.7$ . Model this as a NET payoff (winnings minus the $\text{\char"0024}5$ cost). What is the expected net payoff, in dollars? Enter a number (use a negative sign if it is a loss).