CA Foundation P3 · Chapter 15 · Question 6 of 9
In a game, a player wins ₹50 with probability 0.2, wins ₹20 with probability 0.3, and loses ₹10 with probability 0.5. The expected gain per game is:
Test yourself: pick an answer
Reveal answer & explanation
Correct answer: D) ₹11
Explanation
E(X) = Σ x·p = 50(0.2) + 20(0.3) + (−10)(0.5) = 10 + 6 − 5 = ₹11. Treating the loss as a gain gives 10 + 6 + 5 = ₹21, and ignoring the loss gives ₹16.
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