RonÕs Expected Winnings
¥E = 9pq – 5p – 4q +1
p = 0, q = 1, E = -3
p = 1, q = 0, E = -4
¥RonÕs best strategy is to choose p so as to make E as large as possible.
¥CharlesÕ best strategy is to choose q so as to make E as small as possible.
¥RonÕs best is p = 4/9, but E is still -11/9, so Ron loses $1.22 per play on average.