Answer:
Step-by-step explanation:
Given that A game is played as follows:
A coin is flipped 3 times.
If 3 heads come up, then you win $5.
If 2 heads come up, then you lose $5.
If 1 head comes up, then you lose $4.
If no heads (all tails) come up, then you win $4.
No of heads X 0 1 2 3
Prob p [tex]\frac{1}{8} , \frac{3}{8} ,\frac{3}{8} ,\frac{1}{8}[/tex]
Win 5 -5 -4 4
Expected win of the game = Sum of win amount * Prob
=[tex]\frac{5}{8} +\frac{-15}{8}+ \frac{-12}{8} +\frac{4}{8} \\=\frac{-18}{8}[/tex]
Since expected value is not 0 the game is not fair.
