Overview
“Expected value” is a statistical construct that estimates the value of something by multiplying it by the probability of it happening.
For example, if you want to buy a pack of random Pokemon cards where the chance of getting a card worth 50 * 0.02 = 10 for it, you can reason that it’s not worth the price. You would need a 20% chance of pulling a 10 and have it be worth your while.
Expected value allows us to factor risk and uncertainty into our calculations about costs and benefits.