Question

​Four possibilities are equally likely and have payoffs of $2, $4, $6, and $10. The expected value is:

Answer 1

Answer:

Expected value is 5.5

Explanation:

Expected value = sum of X*P(x)

= 1/4*2 + 1/4*4 + 1/4*6 + 1/4*10

= 0.5 + 1.0 + 1.5 + 2 .5

= 5.5