Question: Skillbuilder Applet Exercise simulates playing a game where a player has a 0.2 probability of winning $3 and a 0.8 probability of losing $1. Repeat

Skillbuilder Applet Exercise simulates playing a game where a player has a 0.2 probability of winning

$3 and a 0.8 probability of losing $1. Repeat the simulations for several sets of 100 plays using the

“Play 25 times” button.

ave gain 21 2 0 20 40 60 80 100 of plays

a. What would you estimate for your expected value (average gain or loss) from the results?

b. Using the following probability distribution, calculate the mean.
x P(x)
$3 0.2 $1 0.8

c. How do your answers to parts a and b compare?
Would you consider this a fair game?
Why?

ave gain 21 2 0 20 40 60 80 100 of plays You lose $1! Play 25 timest Number of plays 75 Total gainoss 15 Clear Average gainfoss

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