Expected value, also known as the mean or expectation, represents the average outcome of a random variable when the process is repeated over and over. It is calculated by multiplying each possible outcome of the variable by its probability of occurrence and summing up these products. The expected value provides a measure of the central tendency or long-term average of a random process.
💡 Expected Value: The cornerstone of
decision-making! It helps you weigh potential outcomes and their probabilities
to make smarter choices. Always think ahead—what's the average payoff? 🧠💰 #MentalModels #DecisionMaking
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