A Person Is Trying to Decide If They Should Buy

question 78

Multiple Choice

A person is trying to decide if they should buy a lottery ticket. The ticket costs $2.00. If the ticket is a winner, the prize would be $1,000. Knowing that winning $1,000 is not a certain outcome (state of nature) , the person finds that the probability of winning is 0.001. Based on this information, the following payoff table can be constructed: What is the probability of losing $2.00?

• A) 0.001
• B) 0.999
• C) 1.00
• D) Cannot be computed

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Definitions:

Terms

Conditions or stipulations specified in an agreement, contract, or understanding between parties.

Active Listening

A method of communication where the listener fully focuses on the speaker, comprehends their message, offers responses, and remembers what was conveyed.

One-Way Communication

One-way communication describes a process where information is sent from a sender to a receiver without expecting or receiving any feedback or response.

Listener Involvement

The engagement and active participation of an audience member in the communication process.