In the Game of Craps, Two Dice Are Rolled, and People

question 64

Multiple Choice

In the game of craps, two dice are rolled, and people bet on the outcome. For example, you can bet $1 that the dice will total 11. The probability that you win is $\frac { 1 } { 18 }$ , and if you win, your profit is $15.
If you lose, you lose $1. What is the expected value of your profit?

• A) $0.83
• B) -$0.94
• C) -$0.11
• D) $0.11

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Definitions:

Sit-down Restaurant

A dining establishment where customers are seated and served by waitstaff, offering a more formal dining experience compared to fast-food or counter-service restaurants.

Net Present Value

A financial metric that calculates the present value of the expected equity of cash flows, considering the time value of money.

Analysis Results

The outcomes or findings of a systematic examination or evaluation, often related to financial data or company performance.

Net Present Value Rule

A financial metric for evaluating the profitability of an investment, measuring the difference between the present value of cash inflows and the present value of cash outflows over time.