Find an expression for muggins'' expected return

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In the game of Blackball, at each turn Muggins draws a ball at random from a bag containing five white balls, three red balls and two black balls; after being recorded, the ball is replaced in the bag. A white ball earns him $1, whilst a red ball gets him $2; in either case, he also has the option of leaving with his current winnings or of taking a further turn on the same basis. If he draws a black ball the game ends and he loses all he may have gained previously. Find an expression for Muggins' expected return if he adopts the strategy of drawing up to n balls, provided he has not been eliminated by then.

Show that, as the entry fee to play is $3, Muggins should be dissuaded from playing Blackball, but, if that cannot be done, what value of n would you advise him to adopt?

Reference no: EM13887294

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