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Scholarship A is worth $2000 and costs $10 to apply. Scholarship B is worth $4000 and costs $25 to apply. You have a 5% chance of receiving Scholarship A and a 1% chance of receiving the Scholarship B.

 

(a) What is your expected value for Scholarship A? 
$  ______________

(b) What is your expected value for Scholarship B? 
$  ________
 

 Sep 30, 2018
 #1
avatar+6252 
+1

P[getting scholarship A]=0.05P[getting scholarship B]=0.01E[Value of scholarship A ]=0.05(200010)+0.95(10)=$90

 

similarly

 

E[Value of scholarship B]=0.01(400025)+0.99(25)=$15

 Oct 1, 2018
 #2
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+1

Thanks 

Guest Oct 1, 2018

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