What is the expected value?

Question

A entartainment plans to invest in a particular project. There is a 35% chance that the entertainment will lose php 30,000 and a 25% chance that the company will make php55,000 otherwise it will break even. Compute for the expected value of the project to the entertainment. express answer to the nearest whole number.

Answer 1

expected value = x * P(x)

here

x P(x)

-30000 0.35

55000 0.25

0 0.4

0.35*-30000 + 0.25*55000 + 0.4*0 = 3250