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George Buys Six Lottery Tickets for $2 Each

question 39

Essay

George buys six lottery tickets for $2 each.In addition to the grand prize,there is a 20% chance that each lottery ticket gives a prize of $4.Assume that these tickets are not grand prize winners.
a.What is the probability that the tickets pay out more than George spent on them?
b.What is the probability that none of the tickets are winners?
c.What is the probability that at least one of the tickets is a winner?


Definitions:

Net Operating Income

A company’s income after operating expenses are subtracted, but before income taxes and interest are calculated.

Residual Income

The amount of income that an individual has after all personal debts, including the mortgage, have been paid.

Minimum Required Rate

The lowest rate of return or discount rate that a project must exceed to be considered as a viable option.

Operating Data

Consists of information gathered from the day-to-day operations of a business, which can include sales figures, production costs, and other performance indicators.

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