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  #1  
Old 10-18-2005, 07:12 PM
skiier04 skiier04 is offline
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Default 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
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  #2  
Old 10-18-2005, 07:15 PM
cardcounter0 cardcounter0 is offline
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Default 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.
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  #3  
Old 10-18-2005, 07:25 PM
MCS MCS is offline
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Default Re: Is playing PowerBall currently +EV???

It's not +EV, but you should play anyway because you want to.
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  #4  
Old 10-18-2005, 07:38 PM
skiier04 skiier04 is offline
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Default 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.
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  #5  
Old 10-18-2005, 07:45 PM
SheetWise SheetWise is offline
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Default 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.
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  #6  
Old 10-18-2005, 07:46 PM
MCS MCS is offline
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Default 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.
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  #7  
Old 10-18-2005, 07:53 PM
cardcounter0 cardcounter0 is offline
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Default 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.
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  #8  
Old 10-18-2005, 09:57 PM
Thythe Thythe is offline
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Default 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.
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  #9  
Old 10-18-2005, 10:02 PM
skiier04 skiier04 is offline
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Default 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.
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  #10  
Old 10-18-2005, 10:10 PM
SheetWise SheetWise is offline
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Default Re: Is playing PowerBall currently +EV???

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

[/ QUOTE ]
Now, there's a strategy we can all get our arms around.

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