Play the Lottery

<p>With the previous mountain entry on Expected Value in mind, we <strong><u>Should</u></strong> <strong><span style="color:#8e44ad;">Play the Lottery Sometimes</span></strong>.</p> <p><strong><span style="color:#2980b9;">Really?</span></strong></p> <p>Yeah, think about it. If the &quot;expected value&quot; of one lottery ticket is greater than the price we paid for it, it actually makes mathematical sense to purchase one, several, or many. You&#39;re &quot;earning&quot; money by doing so.&nbsp;</p> <p><strong><span style="color:#e74c3c;">Let&#39;s Illustrate with an Example</span></strong></p> <p>As shown in the previous mountain entry on Don&#39;t Play the Lottery, the odds of winning the PowerBall lottery are as follows:</p> <p style="text-align: center;">$1$ in approximately $292$ million</p> <p>To calculate the expected value of one ticket, we multiply the above odds by the award -- in this case, a dumpload of money. Let&#39;s imagine the cash prize is $\$100$ million. What would be the &quot;value&quot; of each ticket?</p> <p style="text-align: center;">$(1$ in approximately $292$ million$)$ $\times \$100$ million</p> <p style="text-align: center;">$$\$0.34$$</p> <p>lol. Each ticket is worth about $34$ cents. Given that each ticket costs $\$2$, you&#39;re actually <span style="color:#e74c3c;">losing $\$1.66$</span> every time you buy a lottery ticket in these conditions.&nbsp;</p> <p><strong><span style="color:#27ae60;">But Not Always</span></strong></p> <p>Imagine the cash prize was not $\$100$ million but rather $\$1$ billion. Does that change things?</p> <p style="text-align: center;">$(1$ in approximately $292$ million$)$ $\times \$1$ <strong><u>billion</u></strong></p> <p style="text-align: center;">$$\$3.42$$</p> <p>Dang! With each ticket costing us $2$ bucks, we&#39;re <span style="color:#27ae60;">earning approximately $\$1.42$</span> on every ticket we buy. Score.</p>