Find the Expected Value

question 171

Multiple Choice

Find the expected value.
-Numbers is a game where you bet $1.00 on any three-digit number from 000 to 999. If your number comes up, you get $600.00. If your number doesn't come up, you lose your $1. Find the
Expected net winnings.

• A)-$0.42
• B)-$0.50
• C)-$1.00
• D)-$0.40

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Definitions:

Common Fixed Expenses

Fixed costs not directly attributed to any specific segment of a business, benefiting the entire organization.

Absorption Costing

An accounting method that includes all manufacturing costs — direct materials, direct labor, and both variable and fixed manufacturing overhead — in the cost of a product.

Unit Product Cost

The total cost (including direct materials, direct labor, and overhead) divided by the number of units produced, representing the cost to produce a single unit.

Net Operating Income

The income generated from a company's principal operations, calculated after deducting all operational expenses but before interest and taxes.