Not Homework, but need smart explanation. Trying to figure out payout of certain bet.

NickH

New Member
#1
There is a "money wheel" with 50 slots of dollar amounts the spinner can land on. The dollar amounts are 1$, 2$, 5$, 10$ and 20$. (The larger the dollar amount the higher the payout but less slots there are for it on the spinner therefore less likely to land on) ex. If you put one dollar on the 5$ Slot increment and it lands on one of the few 5's, you profit 5$. My Question: (background) there are 13 slots for the 2$ increment. There are 50 total slots(including the 2$ increments) . If it lands on a 2$ increment then you win 2:1. What is the payout of betting on the 2$ increment?? I came up with 104% but this does not seem correct because the house would be losing the gambling edge. (In this case the festival, not casino) An explanation on how to figure this out would be greatly appreciated, sorry I couldn't get a picture. Thanks :)
 
#2
Re: Not Homework, but need smart explanation. Trying to figure out payout of certain

Payout=amount won * chances of win - amount lost * chances of loss
= 2 * (0.26) - 1 (0.74)
= -0.22