Thread: simple probability exercise View Single Post
#1
12-06-2002, 02:21 PM
 marbles Senior Member Join Date: Oct 2002 Location: Wauwatosa, WI Posts: 568
simple probability exercise

This one might be a little fun for the guys that are more of beginners in probability theory:

All numbers can be found at the "instant games" section of wilottery.com.

For a current scratch-off game, the wisconsin lottery gives the following odds of winning:

\$1 1:10
\$2 1:10
\$10 1:55
\$25 1:400
\$50 1:400
\$100 1:89,143
Grand prize 1:520,000

Question 1: If the Expected return on a \$1 ticket is 67.42 cents (or an E.V. of -32.58 cents, if you prefer), what is the payout for the grand prize?

Question 2: The site gives the odds of "winning" (payout greater than zero) as approximately 1:4.5. What are the odds of returning a profit on a \$1 ticket?

Question 3: What is the expected return on a ticket, given that you know it's a "winner" (payout greater than zero)? Hint: you'll need to solve question 1 first.

solutions later.