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  3. 3 suppose an individual plays a gambling game where it...

Question: 3 suppose an individual plays a gambling game where it...

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#3. Suppose an individual plays a gambling game where it is possible to lose $1.00, break even, win $3.00, or win S10.00 each time she plays. The following table provides the probability distribution for each outcome: Outcome-$1.00 S0.00 S3.00 $10.00 Probability 0.30 0.40 0.20 0.10 a) Find the mean and the variance of the outcome for this game. b) Suppose the casino decides to adjust the payout levels by subtracting S1.00 from each prize Find the mean and the variance of the outcome using the result in part a). c Suppose that the casino decides that the game does not have an impressive enough top prize with the lower payouts, and decides to double all of the prizes in part b). Find the mean and the variance of the outcome.

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