Expected payoff in a dice rolling game

diceexpected valuegame theory

Suppose you roll a pair of dice. If you roll a total of 7, you win \$20, if you roll a total 11, you win \$50; If you roll any other total you lose \$10. Find the expected payoff for this game.

My effort: After counting I obtain expected payoff will be

$(\frac{6}{36})\times 20+\frac{2}{36}\times 50-\frac{28}{36}\times 10=-1.66$

Is it correct or not?

Best Answer

The possible outcomes of rolling two die are equal to the sample space of the first die $(6)$ multiplied by the sample space of the second die $(6)$. This creates 36 possible outcomes.

\begin{array}{|c|c|c|c|c|c|} \hline & 1 & 2 & 3 & 4 & 5 & 6 \\ \hline 1&(1,1) &(1,2) &(1,3) &(1,4) &(1,5) &(1,6)\\ \hline 2&(2,1) &(2,2) &(2,3) &(2,4) &(2,5) &(2,6)\\ \hline 3&(3,1) &(3,2) &(3,3) &(3,4) &(3,5) &(3,6)\\ \hline 4&(4,1) &(4,2) &(4,3) &(4,4) &(4,5) &(4,6)\\ \hline 5&(5,1) &(5,2) &(5,3) &(5,4) &(5,5) &(5,6)\\ \hline 6&(6,1) &(6,2) &(6,3) &(6,4) &(6,5) &(6,6)\\ \hline \end{array}

Inside those $36$ outcomes, the total is $7$ if the two dice are

$$(1,6), (2,5), (3,4),(4,3),(5,2),(6,1)$$

which is $\frac{6}{36}$ possibilities. The total is $11$ if the two dice are

$$(5,6),(6,5)$$

which is $\frac{2}{36}$ possibilities. Rolling any other total is

$$\frac{36}{36}-\frac{6}{36}-\frac{2}{36}=\frac{28}{36}$$

possibilities. Therefore your calculation is correct since

$$\frac{6}{36}\left($20\right)+\frac{2}{36}\left($50\right)-\frac{28}{36}\left($10\right)\approx-$1.66$$

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