Option C: Cash4Life, Lucky4Life or similar (groups of 2): 1. Find the expected value without the lifetime prizes considered. 2. Find the expected value assuming the cash option will be selected rather than the annuity 3. Find the expected value if the annuity will be paid for 20 years. (minimum the lottery will pay out) 4. Find the expected value if the annuity will be paid for 50 years. 5. If none of the above values made buying a ticket "worth it" how long would you have to receive the annuity for the ticket to be "worth it"? For each of the above make sure to answer the question is it "worth it" to buy tickets?

Algebra & Trigonometry with Analytic Geometry
13th Edition
ISBN:9781133382119
Author:Swokowski
Publisher:Swokowski
Chapter10: Sequences, Series, And Probability
Section10.8: Probability
Problem 69E
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Lucky4life lottery tickets are 2 dollars.Use the Expected value formula. The mean of a discreate probability distrubution.

Option C: Cash4Life, Lucky4Life or similar (groups of 2):
1. Find the expected value without the lifetime prizes considered.
2. Find the expected value assuming the cash option will be selected rather
than the annuity
3. Find the expected value if the annuity will be paid for 20 years. (minimum
the lottery will pay out)
4. Find the expected value if the annuity will be paid for 50 years.
5. If none of the above values made buying a ticket "worth it" how long would
you have to receive the annuity for the ticket to be "worth it"?
For each of the above make sure to answer the question is it "worth it" to buy
tickets?
Transcribed Image Text:Option C: Cash4Life, Lucky4Life or similar (groups of 2): 1. Find the expected value without the lifetime prizes considered. 2. Find the expected value assuming the cash option will be selected rather than the annuity 3. Find the expected value if the annuity will be paid for 20 years. (minimum the lottery will pay out) 4. Find the expected value if the annuity will be paid for 50 years. 5. If none of the above values made buying a ticket "worth it" how long would you have to receive the annuity for the ticket to be "worth it"? For each of the above make sure to answer the question is it "worth it" to buy tickets?
LUCKY FOR LIFE ODDS & PRIZES
Winners
1
2-14
MATCH THESE BALLS
15 or more
SECOND PRIZE
Winners
1-20
+
21 or more
"Divided by the number of winners
Annuitized Payment Option
AND YOU HAVE WON
$1,000 a day for life
$1,000 a day for life
(No annuitized payment option)
$1,000 a day, FOR LIFE"
Annuitized Payment Option
$25,000 a year for life
(No annuitized payment option)
$25,000 a year, FOR LIFE
$5,000
$200
$150
$20
$25
$3
56
$4
What if you don't want the
option)
OODS
LUCKY FOR LIFE PRIZE OPTIONS
The minimum payment period for the top and second prizes is 20 years. Both have the choice of a Cash Option as an alternative to th
as described in the table below. Prizes that are governed by "split-prize" liability are divided equally among the winning tickets and ma
TOP PRIZE
1 in 30,821,472
1 in 1,813,028
1 in 143,356
1 in 8,433
1 in 3,413
1 in 201
1 in 250
1 in 15
1 in 50
1 in 32
Cash Option
$5,750,000.00
$5,750,000.00*
$7,125,000.00*
Cash Option
$390,000.00
$9,400,000.00*
Transcribed Image Text:LUCKY FOR LIFE ODDS & PRIZES Winners 1 2-14 MATCH THESE BALLS 15 or more SECOND PRIZE Winners 1-20 + 21 or more "Divided by the number of winners Annuitized Payment Option AND YOU HAVE WON $1,000 a day for life $1,000 a day for life (No annuitized payment option) $1,000 a day, FOR LIFE" Annuitized Payment Option $25,000 a year for life (No annuitized payment option) $25,000 a year, FOR LIFE $5,000 $200 $150 $20 $25 $3 56 $4 What if you don't want the option) OODS LUCKY FOR LIFE PRIZE OPTIONS The minimum payment period for the top and second prizes is 20 years. Both have the choice of a Cash Option as an alternative to th as described in the table below. Prizes that are governed by "split-prize" liability are divided equally among the winning tickets and ma TOP PRIZE 1 in 30,821,472 1 in 1,813,028 1 in 143,356 1 in 8,433 1 in 3,413 1 in 201 1 in 250 1 in 15 1 in 50 1 in 32 Cash Option $5,750,000.00 $5,750,000.00* $7,125,000.00* Cash Option $390,000.00 $9,400,000.00*
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