Something in my stats elective got me thinking about maths and gambling sites, and I decided to try out the expected value formula on bustabit data.
E(X) = ∑X * P(X)
Basically, the expected value for a set of data is the sum of each data point multiplied by the probability of its occurence. For example, if the odds of getting a 0 is 50% and the odds of getting a 1 is also 50%, your expected value would be (0*0.5)+(1*0.5) = 0.5, so it's sort of like a weighted average.
I took a table with all possible bust values on bustabit and their corresponding odds. The formula to calculate the odds of a bust is the absolute value of [(0.99/bust+0.01)-(0.99/bust)]. The odds of getting exactly 1x are 0.0198, exactly 1.1x are 0.00892, and so on. As per the formula for E(X), I multiplied each bust value with its corresponding probability and summed the total, which came out to over 2.3, even though the expected value is supposed to be 1.98. Can anyone tell me which part of this is wrong? Thanks
Topic: Could someone tell me which part of the calculation I messed up? - page 2. (Read 359 times)
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