|Posted: May 19, 2006, 10:24 am - IP Logged|
The cash value of the Megamillions jackpot is $6.7M and is advertised at $12M. Although the advertised value of the reset PB jackpot is higher, the cash value is slightly lower, $6.6M.
Because the odds of winning the Powerball are higher than the odds of winning the MM, the Powerball is still a better bet.
It will be interesting, though, should the jackpots role simultaneously for a while, to see how it evolves. It is almost certain that every Megamillions jackpot will exceed in cash value, every Powerball jackpot, even though the Powerball jackpot make look larger for a while in advertising terms.
The Megamillions expectation value, the ratio of risk to potential outcome, is a terrible 0.22. The Powerball expectation value is an equally miserable 0.24.
The Megamillions jackpot will be a better bet than Powerball when the cash jackpot for it exceeds Powerball's cash value by about 20%.
For the record (although I certainly buy tickets before this), megamillions and powerball generally become good bets (expectation value > 1) only when the jackpots exceed $300M in the advertised annuities.