Saturday, 7 April 2018

The New Powerball

I received an email from the Lott today announcing the following changes to Powerball:
New Powerball Updates 
BIG JACKPOTS
There is an increased chance of big jackpots occurring more often.
 
MORE WINNERS
There will be more overall winners in every draw with the chance of winning an overall prize increasing from 1 in 78 to 1 in 44.
 
NEW 9TH PRIZE DIVISION
The Powerball prize structure will include an extra 9th prize division.
 
NUMBER UPDATES
The New Powerball game will feature 7 winning numbers drawn from a barrel of 35 balls (numbered 1-35). This was previously 6 numbers drawn from a barrel of 40 balls (numbered 1-40).
 
We’ve randomly generated replacements for numbers greater than 35 and added a new 7th number to your Favourite and Subscription entries.
There will be no changes to the Powerball. It will still be drawn from a barrel of 20 balls (numbered 1-20).
This claim of an increased chance of big jackpots occurring more often is perplexing because it seems that the number of possible combinations has increased, meaning the probability of winning has decreased (significantly as we can see below):$$ \text{BEFORE }\binom{40}{6} \times 20 = 76,767,600 \text{ <---> AFTER } \binom{35}{7} \times 20 = 134,490,400$$ The chance of winning, that is getting the correct combination of seven numbers and the powerball, is now almost halved.

Maybe I'm missing something but I can't see what it is. There may well be more overall winners with the introduction of a 9th prize division but I wonder if the provision of even more piddling minor prizes will actually entice punters. Even without knowing the precise probability, most punters will recognise intuitively that, with the powerball choices remaining the same, the chance of getting seven numbers correct out of 35 is going to be considerably less than getting six numbers out of 40. All punters have their eye of the big prize not on the increasing proliferation of minor prizes.

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