Suppose that there is a gambling game, where there is a
60% probability that you will lose $1, and a 40% proba-
bility that you will gain $1. Suppose that you play the
game 100 times, and each time you play is independent
of any other time.
(a) Find the probability the total amount you go home
with is at least 0 (you have broken even, or went
home with some positive gain).
(b) Find the probability that the total amount you go
home with is larger that $5 (you have a net gain of
$5).
(c) Find the probability that the total amount you go
home with is less that -$5 (you have a net loss of $5).
(d) Find the 99th percentile for the total amount you go
home with.
