M.4HSTP.36.b

Evaluate and compare strategies on the basis of expected values. (e.g., Compare a high-deductible versus a low-deductible automobile insurance policy using various, but reasonable, chances of having a minor or a major accident.)

Example Problems
A fair coin is flipped 5 times. Let be the number of heads. What is the expected value of ?
In a game you roll a fair six-sided die. You receive (3 times the number showing) dollars minus 5 dollars. What is the expected payout?
A photocopier has a chance of breaking this month, which would cost to repair; otherwise, there is no repair cost. What is the expected repair cost for the month?
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