Learning Goal
Evaluate and compare strategies using expected values
Teacher tools for this standard
Lesson Plan · Guided Notes · Exit Ticket · Re-teach · Homework
Teacher tools for this standard
Lesson Plan · Guided Notes · Exit Ticket · Re-teach · Homework
- Lesson Plan →Objectives, pacing and practice, built from this lesson's brief.
- Guided Notes →One page your students fill in and keep.
- Exit Ticket →Three items at the end of class. No student accounts.
- Re-teach →After an exit ticket: who missed what, and what to do tomorrow.
- Homework →Assign practice; it grades itself.
**HSS.MD.B.5.b**: Evaluate and compare strategies on the basis of expected values. For example, compare a high-deductible versus a low-deductible automobile insurance policy using various, but reasonable, chances of having a minor or a major accident.
**HSS.MD.B.5**: (+) Weigh the possible outcomes of a decision by assigning probabilities to payoff values and finding expected values.
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HSS.MD.B.5.b: Evaluate and compare strategies on the basis of expected values. For example, compare a high-deductible versus a low-deductible automobile insurance policy using various, but reasonable, chances of having a minor or a major accident.
HSS.MD.B.5: (+) Weigh the possible outcomes of a decision by assigning probabilities to payoff values and finding expected values.
What you'll learn
- Model each of two or more competing strategies as a payoff or cost distribution
- Compute the expected value (expected cost or expected payoff) of each strategy
- Compare the strategies and recommend one based on expected value, stating whether lower or higher is better
- Perform a sensitivity analysis: recompute the comparison under different reasonable probabilities and find the break-even probability where the recommendation changes
- Explain that expected value is the primary criterion while risk tolerance can justify a different choice
Slides
Step through the lesson, or watch it as a narrated video • 2 slide decks
Comparing options and insurance
✓ Start hereSensitivity and risk
Practice
Try it on your own