I checked out the fine print included in the add. It doesn't seem as good as it did a minute ago:
2015 Jeep Patriot or $25,000 - Odds of Winning - 1:25,000
$100 - Odds of Winning - 1:25,000
$2 - Odds of Winning - 24,998:25,000
So first of all, I didn't have a three out of four chance of winning something good as you had a chance to win the $25,000 or the car, but not both. So I have a two out of three chance of winning something good.
Secondly, it turns out I don't have a two out of three chance. I have a two out of 25,000 chance.
Good can come out of this, as there is much students can learn from this.
For one, it could be pointed out that despite what the ad says, these are probabilities and not odds, but why quibble?
Next, students could spot all the mind games that are being played. Getting you hooked by having you scratch off something. Feeling lucky when you are successful (which undoubtedly everyone is). Having what looks like three pretty good prizes, but is only really two.
Students can learn about expected value. The expected value could be found as $25,000 x 0.00004 + $100 x 0.00004 + $2 x 0.99992 = $3.00384
On the plus side, there is no way you can lose, but chances are you don't win very much. In most gambling, a person has to put up some money to play the game. That is the upside for the person/company/casino running the game. In those cases, the house typically sets up the game so the player's expected value is a negative number. What is the company's incentive in this case? They are obviously hoping to win their money on the back side of the game. They're hoping to get extra traffic to their showroom to sell a few more cars.Gimmicky advertisements can be a great learning experience.
