probability

Question

A large spinning wheel has 20 pie slices of different colors. There are 8 green slices, 5 red slices, and the rest are black. If you spin the wheel and the pointer stops at green you win $2, stops at red you win $5, stops at black you win nothing. If you are charged $5 to play this game then how much is the expected value if you played 10 times?

Answer 1

Well, on each roll, you have an 8/20 chance of green and losing $3 (winning $2 after spending $5).

 

(8/20)(-3) + (5/20)(0) + (7/20)(-5) = -39/20 = -1 19/20 = $-1.57

 

Ten games has an expected value of $-15.70.