Chapter 20
Assume the probability that a 21 year-old male individual gets in an accident in the next
year is 0.005. The insurance company charges $600 for a $30,000 policy. The expected
value for the insurance company on each policy is computed as follows: Expected
value= $600(0.995) - $______(0.005) - ANS-$29,400
Expected value= 600*.995 -$29,400(.005)
FB The law of large of large numbers says that if you were to roll a fair die many times,
the average of all your rolls will be approximately equal to the ___________ value. -
ANS-expected
If the expected value of a game is zero, the game is said to be ______________. -
ANS-fair
If you don't know the outcome ___________, you can estimate the expected value by
simulation. - ANS-probabilities
Kelsey is playing a dice rolling game. If she rolls a 5 or 6, she wins $6. If she rolls less
than a 5, she has to pay $3. The expected value of this game is __________. Use exact
probabilities in your calculations. - ANS-$0
Expected value= $6 x (1/3) - $3 x (2/3) = $2 - $2 = $0.
One can use simulation of random digits to find the average number of children a
couple needs to have until they have a girl or until they have 3 children. Suppose a pair
of digits simulates one child, with 00 to 48 standing for a girl and 49 to 99 standing for a
boy. Suppose the simulation is done 7 times with the following results: Using the table,
the expected number of children a couple will have is________. - ANS-2
One can use simulation of random digits to find the expected number of free throws a
person needs to make before she makes her first shot. Suppose a pair of digits
simulates one free throw, with 00 to 48 standing for a hit and 49 to 99 standing for a
miss. Suppose the simulation is done 6 times with the following results: Using the table,
the expected number of shots a player will have to make until she makes her first is
________. - ANS-2
Pedro is playing a card game where he randomly selects a card from a full deck. If the
card is red, he wins $5. If it is not, he pays $5. The expected value of this game is
________. - ANS-$0
Assume the probability that a 21 year-old male individual gets in an accident in the next
year is 0.005. The insurance company charges $600 for a $30,000 policy. The expected
value for the insurance company on each policy is computed as follows: Expected
value= $600(0.995) - $______(0.005) - ANS-$29,400
Expected value= 600*.995 -$29,400(.005)
FB The law of large of large numbers says that if you were to roll a fair die many times,
the average of all your rolls will be approximately equal to the ___________ value. -
ANS-expected
If the expected value of a game is zero, the game is said to be ______________. -
ANS-fair
If you don't know the outcome ___________, you can estimate the expected value by
simulation. - ANS-probabilities
Kelsey is playing a dice rolling game. If she rolls a 5 or 6, she wins $6. If she rolls less
than a 5, she has to pay $3. The expected value of this game is __________. Use exact
probabilities in your calculations. - ANS-$0
Expected value= $6 x (1/3) - $3 x (2/3) = $2 - $2 = $0.
One can use simulation of random digits to find the average number of children a
couple needs to have until they have a girl or until they have 3 children. Suppose a pair
of digits simulates one child, with 00 to 48 standing for a girl and 49 to 99 standing for a
boy. Suppose the simulation is done 7 times with the following results: Using the table,
the expected number of children a couple will have is________. - ANS-2
One can use simulation of random digits to find the expected number of free throws a
person needs to make before she makes her first shot. Suppose a pair of digits
simulates one free throw, with 00 to 48 standing for a hit and 49 to 99 standing for a
miss. Suppose the simulation is done 6 times with the following results: Using the table,
the expected number of shots a player will have to make until she makes her first is
________. - ANS-2
Pedro is playing a card game where he randomly selects a card from a full deck. If the
card is red, he wins $5. If it is not, he pays $5. The expected value of this game is
________. - ANS-$0
