pmugri asked: At a certain prize level it makes statistical sense to buy a Mega Millions lottery ticket.
What is grand prize amount that makes it make sense?
I asked this question previously, but didn’t get any math answers. I did the stats myself and came up with the number of $303M.
The small amounts contribute about 22 cents of expected value.
The chance of 1 or more winners is 1 in 176 M, = (5/56*4/55*3/54*2/53*1/51&1/46)
The chance of exactly 1 winner is 1 in 212M
The chance of exactly 2 winners is 1 in 1.2B
The chance of exactly 3 winners in 1 in 7B
The jackpot contributes 78 cents of after tax lump sum payment expected value when the jackpot is 303M.
PrizeOddsPercentEV
$250,000 3,819,816 0.00003%$0.07
$10,000 650,783 0.00015%$0.02
$150 14,147 0.01%$0.01
$150 12,515 0.01%$0.01
$10 708 0.14%$0.01
$7 272 0.37%$0.03
$3 98 1.0%$0.03
$2 46 2.2%$0.04
Total $0.22
Albert