A Scratch-Off Lottery Ticket Costs $5

question 36

Multiple Choice

A scratch-off lottery ticket costs $5.00 to purchase, and it pays out a prize of $0, $5, $10 and $100 with probabilities of 90%, 8%, 1.5% and 0.5%, respectively. What is the expected value of the profit of this Scratch-off lottery ticket?

• A) -$4.49
• B) -$4.25
• C) -$4.08
• D) -$3.95
• E) None of the above.

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Definitions:

Scientific Study

The systematic investigation of the natural world through experimentation and observation, aimed at discovering and acquiring knowledge.

Wilhelm Wundt

A German physiologist and psychologist who is generally considered the father of experimental psychology.

Conscious Experience

The subjective awareness of the mind regarding thoughts, feelings, and perceptions, encompassing the aspects of consciousness that are introspectively accessible.

Wilhelm Wundt

Known as the father of experimental psychology, he established the first psychological laboratory in Leipzig, Germany, in 1879.