Question

A baseball team loses $100,000 for each consecutive day it rains. Say X, the number of consecutive days it rains at the beginning of the season, has a Poisson distribution with mean 0.2. What is the expected loss before the opening game?

Answer 1

Given that, X be the number of consecutive days it rains at the beginning of the season, has a poisson distribution with mean 0.2

That is, $X \sim Poisson ( \lambda = 0.2)$

Therefore, the expected number of X is,

$E(X) = \mu_x = \lambda = 0.2$

The team loses $100000 per day, thus the expect loss is,

$\text { Expected loss }= \$ 100000 * E(X)= \$ 100000 * 0.2= \$ 20000$

Therefore, the expected loss before the opening game is, $20,000