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Financial Financial ExpectationExpectationStage 6 - Year 12Stage 6 - Year 12
General Mathematic(HSC)
2
Financial Expectations
is the average financial return from a chance situation.
It tells us if we can expect a gain or a loss over a long period of time.
Example
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In a coin tossing game you win $1for a head and lose $1for a tail.
F.E. = 12
x $1 +
12
x -$1 = $0
P(H) =12
P(T) = 12
No Gain or Loss per game
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Tossing a Coin ExperimentTossing a Coin Experiment
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Financial Expectations
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Financial Expectations
Example: Bet on the RedIn a roulette game you win $1 for a red
and lose $1 for a black and lose $1 for a green.
F.E. = 1837
x $1 +
1837
x -$1 +
= -$0.03
P(R) = 1837
P(B) = 1837
Net Loss of 3 cents per game.
P(G) = 1 37
1 37
x -$1
Red Black Green
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HTHT
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Two-Up - Tossing a Coin ExperimentTwo-Up - Tossing a Coin Experiment
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TTTT
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