Math Problem Statement
A lottery has a grand prize of $1,000,000, 2 runner-up prizes of $100,000 each, 6 third-place prizes of $10,000 each, and 19 consolation prizes of $1,000 each. If a 4 million tickets are sold for $1 each, and the probability of any ticket winning is the same as that of any other winning, find the expected return on a $1 ticket. (Round your answer to 2 decimal places.)
Solution
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Math Problem Analysis
Mathematical Concepts
Probability
Expected Value
Basic Arithmetic
Formulas
P(Grand Prize) = 1/Total Tickets
P(Runner-up Prize) = 2/Total Tickets
P(Third Place Prize) = 6/Total Tickets
P(Consolation Prize) = 19/Total Tickets
Expected Value = Sum of (Prize Amount × Probability)
Theorems
Law of Total Expectation
Suitable Grade Level
Grades 9-12
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