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Answer the Question About the Law of Large Numbers

question 41

Multiple Choice

Answer the question about the Law of Large Numbers.
-A gambler playing blackjack in a casino has lost each of his first 16 bets. If he correctly understood the Law of large Numbers, which strategy would he use in betting on future blackjack hands?
A. He should bet based on the merit of each individual hand. While the proportion of wins should eventually approach
The true probability of winning, this does not mean that he is likely to recover early losses.
B. He should bet more on the next 16 hands, because the proportion of wins should quickly approach the true
Probability of winning.
B. He should bet less on the next 16 hands, because it doesn't look like this is a good day for him.
D. He shouldn't use any of the above strategies.

Definitions:

Perpetual Inventory System

An inventory system that records the sale or purchase of inventory immediately through the use of computerized point-of-sale systems and enterprise asset management software.

Cost of Goods Sold

Represents the direct costs attributable to the production of the goods sold by a company, including the cost of the materials and labor used to create the product.

LIFO

An inventory valuation method that assumes the items most recently put into inventory are the first ones sold.

Ending Inventory

The overall worth of items ready for sale after an accounting period, determined by starting inventory added to purchases and then subtracting the cost of goods sold.