Expected Value of a Lottery Ticket
A charity sells 10,000 lottery tickets for $1 each. There is one prize. The table provided shows the probability distribution for the net payoff for a person who buys one ticket. If the prize money were doubled, what would be the new expected value of the net payoff per ticket?
| Outcome | Net Payoff | Probability |
|---|---|---|
| Win | ||
| Lose |
A
The expected value becomes approximately per ticket.
B
The expected value becomes per ticket.
C
The expected value remains a loss per ticket.
D
The expected value becomes exactly per ticket.
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