Find the expected value.
-Mr.Cameron is sponsoring an summer concert.He estimates that he will make $300,000 if it does not rain and make $60,000 if it does rain.The weather bureau predicts the chance of rain is 0.34 for the day of the concert.What are Mr.Cameron's expected concert earning?
A)$360,000
B)$60,000
C)$300,000
D)$218,400

Question

Quizplus · Accepted Answer

The expected value can be calculated by taking the weighted average of the two possible outcomes, where the weights are the probabilities of each outcome. The expected earnings can be calculated as:
Expected earnings = (Probability of no rain * Earnings with no rain) + (Probability of rain * Earnings with rain)
Expected earnings = (0.66 * $300,000) + (0.34 * $60,000)
Expected earnings = $218,400
Thus, the best choice is D.

Find the Expected Value