You enter Chicago subway by swiping your CTA card at a turnstile, you pay $3.75. The...

You enter Chicago subway by swiping your CTA card at a turnstile, you pay $3.75. The evasion fine( for being caught riding the subway without swiping your card) is $200. suppose that the CTA police catches only 1 in 20 people that ride the subway without swiping their card. Use the expected value of a random variable to decide whether, over a long period of time, it is cheaper to swipe your card at the turnstile or not.

Hint: Consider the random variable Y which is the amount you pay when you ride the subway without swiping your card at the turnstile.

Expert Solution

We find the expectation of the random variable Y and compare it with the money required to swipe your card at the turnstile to find out which one is cheaper. The detailed solution is in the picture attached

orchestra answered 1 year ago

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