Example In a carnival game a player flips a coin twice. The player pays $1 to play.
The player then
receives $1 for every head observed and pays $1, to the game attendant, for every Tail observed. Find
the probability distribution for the random variable X = the player’s (net) earnings.
There are 4 possible outcomes HH, HT, TH, TT. The return to the player in the case
HH is 1, the return to the player in the case HT or TH is −1, and the return to the
player in the case TT is −3. Hence and
Example In Roulette, if you bet $1 on red, you get your $1 back + $1 profit if the ball lands on red. If the
ball does not land on red, the attendant keeps your money and you get nothing back. The roulette
wheel (Vegas) has 18 red numbers, 18 black numbers and 2 greens. The ball is equally likely to go into
any of the pockets. What is the probability distribution for your earnings for this game if you bet $1 on
red.
There are only two outcomes: you win $1 or
you get −$1.
.
Extras
Example: Netty’s Scam Netty the Incredible runs the following scam in her spare time:
She has a business where she forecasts the gender of the unborn child for expectant couples, for a
small price. The couple come for a visit to Netty’s office and, having met them, Netty retires to her ante-
room to gaze into her Crystal Ball. In reality, Netty flips a coin. If the result is “Heads” , she will predict a
boy and if the result is “Tails”, she will predict a girl. Netty returns to her office and tells the couple of
what she saw in her crystal ball. She collects her fee of $100 from the couple and promises to return
$150 if she was wrong.
What is the probability distribution for Netty’s earnings per consultancy in this business?
1
Netty will win $100 if she wins and lose $50 if she loses.
Let X be the random variable which is the amount Netty
wins in one consultancy. Hence P(X = 100) = 0.5 and P(X
= −50) = 0.5.
Example Harold and Maude play a card game as follows. Harold picks a card from a standard deck of
52 cards, and Maude tries to guess its suit without looking at it. If Maude guesses correctly, Harold
gives her $3.00; otherwise, Maude gives Harold $1.00. What is the probability distribution for Maude’s
earnings for this game (assuming she is not “psychic”) ?
If X is the random variable which is the amount
Maude wins in one round. Either Maude wins $3
or she looses $1. Hence
and .
Example At a carnival game, the player plays $1 to play and then rolls a pair of fair six-sided dice. If the
sum of the numbers on the uppermost face of the dice is 9 or higher, the game attendant gives the
player $5. Otherwise, the player receives nothing from the attendant. Let X denote the earnings for the
player for this game. What is the probability distribution for X?
The player either wins $5 - $1 = $4 or looses $1.
and .
Example The rules of a carnival game are as follows:
1. The player pays $1 to play the game.
2. The player then flips a fair coin, if the player gets a head the game attendant gives the player $2
and the player stops playing.
3. If the player gets a tail on the coin, the player rolls a fair six-sided die. If the player gets a six, the
game attendant gives the player $1 and the game is over.
2
4. If the player does not get a six on the die, the game is over and the game attendant gives nothing
to the player.
Let X denote the player’s (net) earnings for this game, what is the probability distribution of X?
A tree diagram could help.
netearning=1
0.5
0 1 netearning=0
6
0.5
T
5
6
netearning=-1
Example: Requires True Grit. The rules of a carnival game are as follows:
• The player pays $5 to play.
• The attendant then deals a random selection of 5 cards from a standard deck of 52 cards to the
player.
• If the player has at least three aces in the 5 cards he/she is dealt, the attendant gives the player
$100 and the game is over.
• Otherwse the player selects 3 cards from the 5 he/she was dealt and discards them. The
attendant gives the player a random selection of 3 cards from the remaining cards in the deck to
replace the ones discarded.
• The player now has 5 cards and if the player has at least 3 aces among the 5 cards, then the
attendant gives the player $100 and the game is over.
• If the player does not have at least 3 aces among the 5 cards, then the attendant gives the player
nothing and the game is over.
Let X denote the player’s (net) earnings for this game, what is the probability distribution for X. (Hint:
use a tree diagram classifying outcomes according to the number of aces dealt.)
3
A tree diagram could help again.
netearning=95
P (3 or4aces )
0 netearning=-5
P (2 aces) Pr 2(0 aces)
Pr 2(1 or2aces )
• netearning=95
P (1 ace)
P (0 aces)
Pr 1(2 or3aces )
• netearning=95
Pr 1(0 or1ace )
• netearning=-5
Pr 0(3 aces)
netearning=95
Pr 0(0,1or2aces )
net earning = -5
We have calculated the needed probabilities before. The probability of getting k aces
in round 1 is .
The probabilities Prk are a bit different. There are only 47 cards in round 2 and
the number of aces in the round 2 deck is 4 minus the number of aces we got in
round 1. You are only dealt 3 cards, not 4.
In any case, the only two outcomes are a net earning of $95 or -$5. There are 4
paths which end in $95. Here are the pieces.
P(3 or 4 aces) =
P(2 aces) = (0 aces) = .
Pr2(1 or 2 aces) =
Pr1(2 or 3 aces) =
Pr0(3 aces) =