An example of probabilities in a coin-tossing experiment

Illustrates an example of probabilities in a simple coin-tossing experiment.




1593_Probabilities in a simple coin-tossing experiment.png

Probabilities in a simple coin-tossing experiment: one toss.

Above shows the distribution for the above coin-tossing experiment.

Now here's what your total profit will be like after one thousand tosses as in figure. Your expected profit after one toss is

(1/6) x 10 + (5/6) x (-1) = 5/6 ≈ 0.833

Now variance is as:

(1/6) x (10 - (5/6))2+ (5/6) x (-1-5/6)2 = 605/54

   Related Questions in Financial Management

2015 ©TutorsGlobe All rights reserved. TutorsGlobe Rated 4.8/5 based on 34139 reviews.