Question

College playboy “Studley” Moore likes to throw lavish parties in his spacious Davis apartment. He has one quirk though. He insists that every guest, on their way in, play a game of “odd or even” with him. Each of the two sticks out one or two fingers, and Studley wins if the sum is even. Studley pays the guest $5 when the sum is odd (i.e., there are oneor three fingers showing), but he collects $6 when the sum is two and $4 when the sum is four. Suppose that Studley uses the strategy of sticking out one finger with probability 7/12 and two fingers with probability 5/12. Assume that each guest chooses one or two fingers with equal probability. Find the probability distribution for Studley's winnings W in a game of odd or even, and compute Studley's expected winnings in this game. Would always sticking out one finger be a better strategy for Studley (up until he gets found out)?

Answer 1

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