​In a Coin Toss Bet,where Both Heads and Tails Are

question 45

Multiple Choice

​In a coin toss bet,where both heads and tails are equally likely,you win a dollar on heads but lose a dollar on tails.The expected value of the bet is

• A)​$0.50
• B)-$0.50
• C)$1.00
• D)​$0.00

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Definitions:

Compounded Annually

A method where the interest earned is added to the principal sum at the end of each year, resulting in interest being earned on interest in subsequent years.

Compounded Annually

Refers to the process where interest earned on an investment is added to the principal, and the new total becomes the basis for computing interest in the next period.

Quadruple

To increase or to be increased fourfold.

Annual Growth Rate

The year-over-year increase in value of an investment, expressed as a percentage.