Question

In a lottery, there are $250$prizes of $\backslash (5,50$prizes of $\backslash )25$, and ten prizes of $\$100$. Assuming that $10,000$tickets are to be issued and sold, what is a fair price to charge to break even?

Short answer

The reasonable price for a single ticket must be $0.35.$

Step-by-step solution

Given information

There were$10,000$ tickets sold, with $250$ rewards of$\$5.50$, $25$ prizes of $\$25,$and ten prizes of $\$100.$

Explanation

$X$	$P\left(X\right)$	$X.P\left(x\right)$
$5$	$250/10000$	$0.125$
$25$	$50/10000$	$0.125$
$100$	$10/10000$	$0.1$
$0$	$9690/10000$	$0$
Total	$1$	$0.35$

$$\begin{gathered} \text{Expectedvalue}=\sum _{}\left[X.p\left(x\right)\right] \\ \text{Expectedvalue}=0.35 \end{gathered}$$

The fair price to charge to break even is $0.35$