AI engineering glossary · Probability
What is expected value?
Expected value (also called Expectation, Mean of a random variable): The long-run average value of a random variable, computed by weighting each possible value by its probability: E[X] = sum of x x P(x). It is the centre of the distribution and drives decisions under uncertainty.
Expected value: an example
A lottery ticket costing Rs 50 that pays Rs 1,000 with probability 0.02 has expected payout 0.02 x 1000 = Rs 20.
Related terms
More Probability terms
- Exponential distribution
- Factorial
- Frequentist probability
- Gambler's fallacy
- Geometric distribution
- Importance sampling
- Independence
- Intersection of events
Where you learn it
Expected value is part of the AI Engineering Program, which teaches it with notes, a hands-on lab and an exam. The first lesson is free.