Question

A spinner game has a wheel with the numbers zero through 40 marked in equally spaced slots. Consider a $1 bet on a number from 1 to 40. If your number hits, you have $40 returned to you; otherwise, you lose your $1 bet. Find the expected return for this bet.

Answer 1

Expected return for this bet = - $0.0243

Explanation:

to find out

the expected return for this bet

solution

we know that Number of slots in the spinner is

Number of slots in the spinner = 0 + 40 = 41 slots

so

P for you winning is here =
`(1)/(41)`

and

Winning amount is = $40

so we can say that

Expected return for this bet is = Winning amount × P (winning) - Cost of bet ...............................1

put here value we get

Expected return for this bet = $40 ×
`(1)/(41)` - 1

Expected return for this bet = - $0.0243