Is playing PowerBall currently +EV???
 

At a $1 ticket, approx 1:140million odds of winning, and a $340 million grand prize it seems like it should be. Am I missing something here because I dont really think it is...

Heres the odds of winning:

http://powerball.com/powerball/pb_prizes.asp

Re: Is playing PowerBall currently +EV???
 

Yap. You are missing Federal, State, and Local taxes. You are also missing the fact that you don't get $340 million. You get a twenty year annuity with a present value that is worth far less, or a big discounted lump sum (minus the previously mentioned Federal, State, and Local taxes). You are also not factoring in the small chance of someone else winning and splitting the prize.

Re: Is playing PowerBall currently +EV???
 

It's not +EV, but you should play anyway because you want to.

Re: Is playing PowerBall currently +EV???
 

Current Jackpot:

$ 340 Million
$ 164.4 Million Cash Value

If the cash value is 164.4 million doesnt that make it +ev???

F it im playing but I still wanna know the answer.

Re: Is playing PowerBall currently +EV???
 

[ QUOTE ]
$ 340 Million
$ 164.4 Million Cash Value

If the cash value is 164.4 million doesnt that make it +ev??? F it im playing but I still wanna know the answer.


[/ QUOTE ]
You're playing with tax free dollars, calculate your winning in tax free dollars. 164.4MM * .6 = 98.64MM if you're the only winner.

Re: Is playing PowerBall currently +EV???
 

[ QUOTE ]
F it im playing but I still wanna know the answer.

[/ QUOTE ]

Yeah, I knew that, which is why I wrote my post the way I did. [img]/images/graemlins/smile.gif[/img]

It's still significantly -EV because of (1) taxes and (2) the nontrivial chance of splitting the top prize even if you win. cardcounter0 explained this already.

Re: Is playing PowerBall currently +EV???
 

$ 164.4 Million Cash Value - Federal Taxes = $ 117 Million Cash Value
Now subtract State Taxes. Then subtract Local Taxes.

I would buy 7 tickets, because 7 is a lucky number.

Re: Is playing PowerBall currently +EV???
 

In addition to what everyone else said, the chance that you split the prize is pretty big too. This was mentioned once, but I thought I'd note that it lowers the EV immensely.

Re: Is playing PowerBall currently +EV???
 

[ QUOTE ]
In addition to what everyone else said, the chance that you split the prize is pretty big too. This was mentioned once, but I thought I'd note that it lowers the EV immensely.

[/ QUOTE ]

This is interesting. Ive never heard of the powerball prize being split before.

At least I understand now how its -ev, thanks for the help.

Re: Is playing PowerBall currently +EV???
 

[ QUOTE ]
I would buy 7 tickets, because 7 is a lucky number.

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Now, there's a strategy we can all get our arms around.

[img]/images/graemlins/wink.gif[/img]