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Expected value

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  • 02-04-2012 3:11pm
    #1
    lessthen50p
    Registered Users Posts: 31 ✭


    I put 100 euro on 3/1 shot but I get 12/1 on it.
    There is one scenario and I can't win this bet, this happens 1 in 4 times.
    So what is my ev in this situation?


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    #2
    Colonel Sanders
    Closed Accounts Posts: 7,669 ✭✭✭Colonel Sanders


    lessthen50p wrote: »
    I put 100 euro on 3/1 shot but I get 12/1 on it.
    There is one scenario and I can't win this bet, this happens 1 in 4 times.
    So what is my ev in this situation?

    I don't understand the highlighted bit but if we assume you have 12/1 about a 3/1 shot then:

    Probability you win = 25%
    Probability you lose = 75%

    Therefore your EV is 12*.25 - 1*.75 = 2.25


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    #3
    Colonel Sanders
    Closed Accounts Posts: 7,669 ✭✭✭Colonel Sanders


    or is there more to this than meets the eye via the highlighted bit (which I didn't understand) and therefore I've misinterpreted the situation :confused:?


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