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Interpretation for gambling

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Reference no: EM131578608

Question: An interpretation in games and gambling makes it clear that it makes sense to expect a random variable to have a value that is not one of the possible outcomes. Suppose that I proposed the following game. You pay me some money, and then you flip three coins. I will pay you one dollar for every head that comes up. Would you play this game if you had to pay me $2.00? How about if you had to pay me $1? How much do you think it should cost, in order for this game to be fair?

Reference no: EM131578608

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