QuestionA raffle ticket costs $3 with 1 winning ticket out of 200 sold. The winner gets an$80 prize. What is the expected value of 1 or 6 tickets? What is the expected total raised?
Expected value of 1 ticket: $(\$80)(1/200) - \$3 = \$0.40 Expected value of 6 tickets:$(\$80)(6/200) - \$18 = \$2.40 Expected total raised:$(200)(\$3) = \$600

Studdy Solution
Calculate the total expected revenue.
$$Total\, expected\, revenue = \$2.60 \times 200 = \$520$$
The expected value (to you) of one raffle ticket is -$2.60. The expected value (to you) if you purchase 6 raffle tickets is -$15.60. The expected value (to the PTO) of one raffle ticket is $2.60. If the PTO sells all 200 raffle tickets, they can expect to raise$520 for the classroom supplies.