Question
In a gambling game a man is paid $5 if he gets all heads or all tails when 3 coins are tossed, and he pays out of $3 if either 1 or 2 heads show. what is his expected gain or loss of the 3 coins?
Answers
John
There are 8 possible outcomes 2^3
Since you either have a head or a tail and 3 coins.
2/8 or 1/4 HHH or TTT
6/8 or 3/4 for the other choices.
1/4 times 5 - 3/4 times 3
-$1
Since you either have a head or a tail and 3 coins.
2/8 or 1/4 HHH or TTT
6/8 or 3/4 for the other choices.
1/4 times 5 - 3/4 times 3
-$1