Question

A charity is selling raffle tickets at $5 apiece. Out of the 100 tickets sold, ten third-place winners will be drawn, each winning $20. Five second-place winners will be drawn, each winning $50. Lastly, one grand prize of $100 will be awarded. Is a raffle with these rules a good idea for the charity? Why or why not?

Answer 1

The Answer is No because that will replace with 0.50cents

Answer 2

The answer is No, because one ticket’s expected value is worth $0.50 more than the face value.