Brain Game: McLanderstone's Offer
McLanderstone & Associates is an odd place to work. Old Man McLanderstone was once a high-school teacher, and he likes to quiz and challenge his employees as if they were his students. This morning, via inter-office memo, he made an offer to his four key employees - Ron, Don, Jon, and Lon. The question is: Should they accept his offer?
NEW WEEKLY EMPLOYEE GAME OPPORTUNITY
At the end of each week, I'll shuffle a regular deck of 52 cards. You'll pay $1 to pull a single card from the deck, and if it happens to be the Ace of Spades, you'll win $50! A random dice roll will determine who gets to draw the first card from the deck, followed by the second, third, and fourth.
If you're the fourth person to draw, the odds are with you, since there will only be 49 cards left in the deck. So the one of you who draws fourth will have a 1 in 49 chance of winning at any given time. Now think about it: If you played 49 times, it would cost you $49, but the odds are that you'd win at least once, which is $50. So you'd be $1 ahead. And remember, there are 52 weeks in the year, not 50, so how could you lose?
What do you say? I need your answer ASAP.
Financially, is this a smart opportunity for the employees?