A gambler starts with $50. The gambler has decided to continue placing bets until either her wealth rises to $100 or her wealth drops to $20. Each bet is for a dollar and results in a loss of the dollar with 50 percent probability or a doubling to two dollars with 50 percent probability. Explain why the gambler's wealth is a martingale. 

What is the chance that the gambler ends up with $100?

Answer rating: 100% (QA)

The gamblers wealth can be considered a martingale because on average the expected value of her weal... View the full answer