A poll taken in Massachusetts in October 2012 showed Obama leading Romney by 60% to 40% in the U.S. presidential race. Let's assume that these numbers represent probabilities. I wished to make a bet with my friend on who would win Massachusetts, and we agreed to base our bet on that poll. I predicted a victory for Obama and would win a profit of $5 if I were right. Assuming we wished this to be a fair game, how much should I have agreed to pay my friend if he was right and Massachusetts went to Romney?

A poll taken in Massachusetts in October 2012 showed Obama leading Romney by 60% to 40% in the U.S. presidential race. Let's assume that these numbers represent probabilities. I wished to make a bet with my friend on who would win Massachusetts, and we agreed to base our bet on that poll. I predicted a victory for Obama and would win a profit of $5 if I were right. Assuming we wished this to be a fair game, how much should I have agreed to pay my friend if he was right and Massachusetts went to Romney?

A First Course in Probability (10th Edition)

10th Edition

ISBN:9780134753119

Author:Sheldon Ross

Publisher:Sheldon Ross

Chapter1: Combinatorial Analysis

Section: Chapter Questions

Problem 1.1P: a. How many different 7-place license plates are possible if the first 2 places are for letters and...

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