# Project #24599 - Law of Large Numbers

An insurance policy sells for \$1200. Based on past data, an average of 1 in 125 policyholders will file a \$10,000 claim, an average of 1 in 100 policyholders will file a \$50,000 claim, and an average of 1 in 250 polictyholders will file a \$80,000 claim. Find the expected value (to the company) per policy sold. If the company sells 10,000 policies, what is the expected profit or loss?

The expected value is-

The expected (profit or loss) is -

In a large casino, the house wins in its blackjack table with a probability of 51.8%. All bets at blackjack are 1 to 1-if you win, you gain the amount you bet; if you lose, you lose the amount you bet.

a. What is the expected value  to you of a single game? What is the house edge?

b. If you played 400 games of blackjack in an evening, betting \$3 on each hand, how much should you expect to win or lose?

c. If patrons bet \$4,000,000 on blackjack in one evening, how much should the casino expect to earn?

A sweepstakes posted the probabilites of winning each prize and the prize amounts as shown in the chart below. Suppose that one sweepstakes entry costs \$1. Find the expected value of the winnings for any indivicual entry. Then state how much you can expect to win or lose if you spend \$165 in entries.

Prize            Probability

\$1,000,000     1 in 100,000,001

\$100,000        1 in 50,000,001

\$1000             1 in 25,000,001

The expected value of the winnings for any individual entry is -

If you spend \$165 in entires, you can expect to (win/lose) -

When you give \$5 for a bet in a casino game, there is a 252/495 probability that you will lose \$5 and there is a 243/495 probability that you will make a net gain of \$5 (If you win the casino gives you \$5 and you get to keep your \$5 bet, so the net gain is \$5) What is the expected value? In the long run, how much do you lose for each dollar bet?

 Subject Mathematics Due By (Pacific Time) 03/08/2014 11:59 pm
TutorRating
pallavi

Chat Now!

out of 1971 reviews
amosmm

Chat Now!

out of 766 reviews
PhyzKyd

Chat Now!

out of 1164 reviews
rajdeep77

Chat Now!

out of 721 reviews
sctys

Chat Now!

out of 1600 reviews

Chat Now!

out of 770 reviews
topnotcher

Chat Now!

out of 766 reviews
XXXIAO

Chat Now!

out of 680 reviews