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Suppose you throw a die n times. Let xi be the ith number you throw on the die and m = max1≤i≤n{xi}, i.e. the maximum number you throw.
(a) When n = 2, what is E[m]?
(b) If you get m = 6 at last, you win six points. Otherwise, you don't get any point. How many points you expect to win in terms of n?
(c) What is E[m] in terms of n?
This problem Set is based on Capital Budgeting, Cash Flows and Cost Capital. It is designed for you to demonstrate your understanding
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