please help Scott likes to day the internet. On a good day, he averages exist2,

Question

please help

Scott likes to day the internet. On a good day, he averages exist2, 400 gain. On a bad day, be averages a exist1700 loss. Suppose that he has good days 25% of the time bas days 36% of the time, and the rest of the time, he breaks even. What is the expected value of Scott's day trading hobby? After 1 month (30 days), how much money would he expect to make loss? (In other words, what is the net gain/loss)? a. exist12, exist360 gain b. exist12, exist360 loss c. exist60, exist18,000 gain d. exist1212, exist36, 360 gain e. exist12, exist18,000 loss f. None of these are correct

Explanation / Answer

on a good day he averages $2400 gain and 25% of the time = $2400 *25%=$600

on a bad day he averages $1700 loss and 36% of the time =

$1700*36%=$612

we have formulea is

Expectancy = (Probability of Win * Average Win) – (Probability of Loss * Average Loss)

Expentancy = $600-$612= -$12

After one month means 30 days the gain or profiylt is -$12(30)= -360 as its negative it will have loss

so answer is

option b $-12 ,-360 loss

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