The Expected Value of a Gamble Is the

question 8

Multiple Choice

The expected value of a gamble is the

• A) expected maximum you could win if you are lucky enough to win the gamble.
• B) expected minimum you could win in a sure bet.
• C) average amount you would win or lose if you played that gamble many times.
• D) average amount you would win or lose if you played that gamble once.
• E) average amount you and your friends would win if you and your friends played that gamble a few times.

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Definitions:

Order of Liquidity

The arrangement of assets on a balance sheet in order of the time it would typically take to convert them into cash.

IFRS

International Financial Reporting Standards, a set of accounting principles that establish how transactions and other accounting events should be reported in financial statements on a global scale.

Fair Value

The estimated price at which an asset could be bought or sold in a current transaction between willing parties.

GAAP

Generally Accepted Accounting Principles, a set of rules and standards for financial reporting used in the United States.