Expected Value Objectives Determine the expected value of

Expected Value

Objectives • Determine the expected value of an event.

Vocabulary • expected value • decision theory

Of all workers at a certain factory, the proportions earning certain hourly wages are as follows: hourly wage proportion $8. 50 $9. 00 $9. 50 $10. 00 $12. 50 $15. 00 20% 15% 5% Find the expected hourly wage that a worker at this factory makes.

Suppose you are taking a multiplechoice test where each questions has choices a through e. If you get the answer correct, you get 4 points. If you get a wrong answer, you lose 1 point. Find the expected value of a random guess.

Suppose you are taking a multiplechoice test where each questions has choices a through e. If you get the answer correct, you get 4 points. If you get a wrong answer, you lose 1 point. Find the expected value of eliminating one answer and guessing among the remaining 4 possible answers.

Suppose you are taking a multiplechoice test where each questions has choices a through e. If you get the answer correct, you get 4 points. If you get a wrong answer, you lose 1 point. Find the expected value of eliminating two answers and guessing among the remaining 3 possible answers.

Suppose you are taking a multiplechoice test where each questions has choices a through e. If you get the answer correct, you get 4 points. If you get a wrong answer, you lose 1 point. Use decision theory and your previous answers to create a guessing strategy for this multiple-choice test.