Mar. 29th, 2007

bohor: (Miffed!)
I understand why people gamble. I understand why people play the lottery, especially when the jackpots are in the hundreds of millions. I mean, even intelligent people can find a rationalization to toss in $1 occasionally, whether it's the donation to educational funds or when the winnings are higher than the odds of winning.

A few weeks ago, somebody won $390 million in the Mega Millions jackpot. The odds weren't horrible, in the sense that the odds of winning were only (only!) 1 in 154 million.*. So I get why people played that. What I don't get is this: the following week, the prize reset back to baseline and was only $12 million. There were 66,802 winning tickets for a total of $326,462. Nobody beat the 1 in 154 million odds to win the $12 million dollar prize, which realistically was only $6 million anyway. The odds of winning any prize is about 1 in 23, so probably just over 1.5 million tickets were sold.

Let's put this another way: In a span of three days, somebody paid $1 for a 1-in-154,000,000 chance to win $6,000,000, and this wonderful moment of questionable sentience happened 1,500,000 times. As best I could figure out, given the risk and the reward, this is the equivalent of betting on a coin toss against 26-to-1 odds, or betting even money that you'll be able to guess which card number and color will be pulled from a shuffled deck.

I think a more appropriate analogy is this... Imagine somebody comes up and makes this offer: If you pay them a dollar, they'll let you stand naked against a wall while a random blind person throws one dart at you, and if he happens to get the dart to stick in your urethra without bleeding (since that's the bonus number), you'll win $6,000,000. That's essentially what it's like playing the lottery with the minimum prize.


* of course these odds aren't a straightforward as they seem. The up-front winnings are substantially less than $390 million--more like $220 million, and was split between two people for this drawing. Both these possibilities knock the players' odds down significantly, and the possibility of winning a prize besides the jackpot boost the odds back up a bit, but even these are parimutuel in nature. Since the overall risk vs. reward for an individual depends on all these factors (most of which are just estimated prior to the game), figuring out the exact odds for an individual player is damn near impossible. The short version of this is: if you're logical, don't ever play. If you're human, it's OK to indulge in your dreams every once in awhile, just take care of your dick.

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Bohor

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