Suppose two equally matched baseball teams (Team A and Team B) are playing in a World Series in which the winner is the 1st team to win 4 games. After 2 games, the series must be halted due to unforeseen circumstances. At that time. Team A leads Team B (2 games to 0 games). The Baseball Commissioner decides to divide the $10 million that would normally go to the winner between the two teams. He calculates P(Team A would have won the series) and P(Team B would have won the series) assuming that the teams are exactly evenly matched. He divides the money up proportionately using these probabilities. How much money should Team A receive and how much money should Team B receive?

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Consider the scenario of team B winning the series It can happen in two ... View the full answer