## Friday, March 22, 2013

### The Economics of 50/50 Draws

"Boy," you might be saying, "this blog has sure posted a lot this month!" You're right! In fact, March so far has had at least twice as many page views as any other month in the existence of this blog. Figuring that this is about as successful as this is ever going to get, I figured I'll just keep posting while the going is hot.

Recently I attended a fair number of arena curling games. People who attend arena curling games often enjoy things like expensive beer, ridiculously addictive popcorn, curling (sometimes), and the 50/50 draw.

A fun way to think about casino games and lotteries (if you're me) is based on their expected return (ok, it's actually not fun at all).

Take Roulette, for instance. If you pick a solid colour in Roulette you have an 18/38 chance of winning, where winning would double your money. Doubling your money isn't quite good enough to break even, though, because 18/38 is slightly less than half. As a result, for every dollar you spend on Roulette, you'd expect to lose 5.26 cents. This is the house edge for Roulette, and what ensures that the casino always comes out on top.

Other common casino games have house edges like 1.41% (pass line in craps), 1.06% (banker bet in Baccarat), and 0.43% (perfect play in Blackjack without counting cards). Slot machines will often run house edges ranging from 7%-15%.

Lotteries are a little bit different. Lotto 6/49, for instance, runs a house edge of about 30%, Keno gambling is approximately 30%-40% depending on the rules, and I suspect that sports betting using SportSelect can get as high as 30%-50%.

Now that we have a reference point, we can compare 50/50 lotteries to these other games. In a basic 50/50 game, everyone could buy \$5 tickets, and one person would win 50% of all the money paid into the lottery. Buying one ticket would give you a 1/n chance of winning, and you would win an amount of money equivalent to n/2 time the price per ticket, at a cost of entry of that same price per ticket. As a result, your expected loss per ticket purchased is 50%. This is way worse than pretty much anything else.

Things get a little bit more complicated though. Many arenas nowadays offer the option of paying \$5 for 1 ticket, \$10 for 3 tickets, or \$20 for 10 tickets. Apart from the obvious differences in price per ticket (making \$20 for 10 seem a substantially better deal already), how do these different options translate into house edges?

Fortunately I made another set obscure and hard-to-read ternary plots for ya! Check it out:

Due to me not thinking before colouring, the axes are a bit backwards. Along the bottom is the fraction of sales for the \$5/1 combo, along the right hand side is the fraction of sales for the \$10/3 combo, and along the left hand side is the fraction of sales for the \$20/10 combo. If you've never read one of these, check out this cool website on how to do so.

In general, the house edge depends on what everyone else buys, which makes sense. It's interesting just how large this effect is, though. Buying a single ticket for \$5 ranges from a house edge of 50% (if everyone else does too) to 80% (if everyone else buys the best combo).

Buying three tickets for \$10 ranges from a house edge of 25%-70%, and buying ten tickets for \$20 ranges from a house edge of 50% to a player edge of 25%. The player edge, of course, only occurs if you are one of a very tiny number of people buying the \$20/10 combo.

Though I can't find any sources for the actual distribution at sporting events, if we had an even split in sales then we'd be looking at a house edge ranging from 40%-75%, depending on which package is purchased. This is by far the worst set of house odds out of any of the games previously mentioned.

50/50 draws are maybe justified in the sense that the money primarily goes to charities, but as an investment (or even just a source of gambling for fun) they're really probably one of the worst things you can do.

See ya!

«Oldest   ‹Older   201 – 250 of 250
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6. MARRIAGE COUNSELLING
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8.JOB PROMOTION SPELLS
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11.lottery spell to win

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Dr Destiny said...
This comment has been removed by the author.
Karl Arnold Stefan said...

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SIMON PATCHIN said...

How To Get Your Ex Lover/Partner/Boyfriend/Girlfriend/Wife Or Husband Back

I was married for 16 years to a loving mother and wife. We had 2 children together who are now 11 & 13. I reconnected with an old girlfriend from college on Facebook and we began an affair and I left my wife. The woman I had an affair with is a wonderful woman and I love her too and our kids had begun accepting the situation and my wife has kind of moved on, but not in love with the man she is seeing. I thought I fell out of love with my wife and I felt terrible about what I did to her - she is a good woman and I don't know what came over me. I decided to try and get her back and I was recommended to Lord Zakuza for help to get reunited with my wife and within 48 hours after I made contact with Lord Zakuza my wife decided to work things out with me and now we are back together with our children living as one happy family. I really don't know the words to use in appreciation of what Lord Zakuza did for me but I will say thank you sir for reuniting I and my family back. For those in trying times with their marriages or relationship can communicate with LORD ZAKUZA through the below information's.

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SIMON PATCHIN said...

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Unknown said...

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Anonymous said...

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It is a very hard situation when playing the lottery and never won, or keep winning low fund not up to 100 bucks, i have been a victim of such a tough life, the biggest fund i have ever won was 100 bucks, and i have been playing lottery for almost 12 years now, things suddenly change the moment i came across a secret online, a testimony of a spell caster called dr emu, who help people in any type of lottery numbers, i was not easily convinced, but i decided to give try, now i am a proud lottery winner with the help of dr emu, i won \$1,000.0000.00 and i am making this known to every one out there who have been trying all day to win the lottery, believe me this is the only way to win the lottery.

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Tamara Barrow said...

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Cristy Davis said...

Hi everyone, after 10 years of playing lotto game i am finally living my dream life, all thanks to Dr Dominion i will never forget that great man never in my entire life, i am who i am today all because of him he gave me a winning numbers to play and he prepared a lotto winning spell for me that helped me won my mega million. thank you so much Dr Dominion for what you have done for my entire generations, i will forever be grateful.
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Margaret Loughrey said...

Margaret Loughrey
I never thought that I could be this wealthy after all I've been through trying to meet ends and take care of my family, I used to play lottery but has never be lucky to win until I saw some comments online how he had helped a lot of people win, after first I didn't believe him but still I gave it a try, I wrote him a message on email after few hours he replied back so I told him what I want he assured me success. he also told me what I should do and I did all he requested from me, after some hours he gave me the lucky numbers and showed me where to play so i did as instructed to my biggest surprise I won 27 million pounds (Euromillions). Now I'm rich and happy all thanks to Dr Benjamin for the help, I'm nothing without you. if you need his help to win you can reach him via his email drbenjaminlottospell711@gmail.com and his whatsapp +13344539570 or visit his website Drbenjamintemple.com

Tamara Barrow said...

I'm 61 years old. I contracted HPV in 2011' I has be taking lot treatment for it and embarrassed some months ago the wart stated coming out seriously, I used lot recommendation because there was lot warts around my anus and was so . but today I'm totally happy I got the virus eliminated by using natural treatment from Dr voodoo herbal center after his treatment I got cured. all the warts went away' seriously believed Dr. voodoo he have the cure for human papillomavirus because he has eliminated hpv been in my body since 2011, Dr. voodoo make it possible for me. Here is Dr. voodoo email: voodoospelltemple66@gmail.com or WhatsApp him via +2348140120719 he is welled capable of curing terrible diseases.

Thomas Yi said...

I'm Thomas Yi from the United States. I started playing lottery games 3 years ago and I have never won big. I went online to seek help on how I can win big in my lottery games and I saw some nice reviews about Dr Amber who has made different people huge winners in their lottery games with his prayers. I gave it a try and I contacted Dr Amber who told me how and what to do before I can become a big lotto winner and I accepted. He made special prayers for me at his temple and gave me the required numbers to play the lotto game and when I played it, I won a massive \$235.4 million POWERBALL jackpot. I was so happy and I chose to receive my winnings in a one-time, lump-sum payment of \$160,038,447.27 at Florida Lottery Headquarters in Tallahassee and the balance was given to the store that I bought & played the game from. I would love other people to seek help from him and he can be contacted through WhatsApp/call/text via this number +1 (406) 646-2222 or you can email him on: amberlottotemple@yahoo.com

Larry Baier said...

I am Larry Baier. I can never stop thanking Dr Graceondu for transforming my life, i have been playing lottery games for a very long time and i have never one day win any game, i met a friend whom i complained to about my inability to win and he introduced me to Dr Graceondu whom helped him by praying for him and giving him a game that he played and he won \$150,000
so i contacted him through his email and he assured me that i will win big. he asked me to give him two day so he can make some prayers on my behalf so that the winning numbers will be revealed to him, so i waited for two days the second day he sent me the number to play, so i play the game i never had it in my mind that i was going to win such amount of money, so on that faithful day i went to check the game on April 16, 2021 and behold i got the biggest shock of my life i won \$2,000,000 and from that moment my life changed.
all thanks to Dr Graceondu, i want to also advice everyone out there to also contact him if you have been playing lottery and you have never won.
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globaltravelsdoc said...

Julie Leach said...

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Nang T said...

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Unknown said...

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