Determine fair price for game of colored ball selection

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Reference no: EM1390624

1. Let's play a game. An urn contains five red, four green and one gold ball other than color, the balls are identical. You are blindfolded and allowed to pick a ball from the urn. Red pays $5, green pays $10 and gold pays $50.

A. Determine the fair price to play this game

B. Let x be the payoff variable for this game. Find e(x)

C. If the price to play this game were $5 a play, would you play? How often? Why

D. If the price to play this game were $15 a play would you play? How often ? Why?

Reference no: EM1390624

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