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Probability and an Unfair Coin 2

Mathematics
Tutor: None Selected Time limit: 0 Hours

An unfair coin is flipped 3 times with the outcomes at each step recorded. The probability of getting a heads is 0.6. 

  • Every time the coin is heads, you will earn $1.00
  • Every time the coin is tails, you will pay $1.50

What is the standard deviation of your net earnings?

Apr 13th, 2015

(E(X)) ^2= expected net earnings=((0.6*$1)^2+(0.4*$1.5)^2)*3= 2.16

E(X^2) =(0.6*$1^2+0.4*$1.5^2)*3 = 4.5

so SD=(4.5-2.16)^0.5=1.53




Apr 13th, 2015

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