Yep, a real contest.
Check the payment schedule:
"The Policy shall provide for payment of the One Billion Dollar Prize over 40 years pursuant to the following payment schedule: $5 million per year for each of years 1 through 20; $10 million per year for each of years 21 through 39 and a lump sum payment of $710 million in year 40 (the “40-Year Payment Schedule”). "
http://billionsweeps.yahoo.com/billionsweeps/static/rules.html
What are the odds?
Try non existant.
I mean first off you’ve got a 1 in a million chance of being selected for the game show…
then you’ve got a 1 in a million chance of randomly selecting the billion dollar 6 digit number.
1000000X1000000 = 1,000,000,000,000
Wouldn’t that be a 1 in a TRILLION occurance?
Of living long enough to collect it that final $710m payment? Depends on how old the winner is, among various and soundry other variables.
Of actually winning the prize? About zero for me, as I don’t drink flat Coke. 
You have to be a ‘legal United States resident’.
Bummer.
CRorex wrote
No, but I don’t know what the right odds are. Could be more or less then that. Basically, lots of people enter, and 1,000 are randomly selected to participate. (odds aren’t exactly 1,000 / # of entrants; each entrant can enter multiple times up to 300, I believe)
Poor Berkshire Hathaway if someone actually wins. The odds of the thing actually paying off to anyone is 1/1,000 (assuming they get the full 1,000 entrants). 1/1,000 is pretty low, but it’s far from impossible. I’m guessing Enki hit it on the head. They’re counting on you dying before you get the bulk of it.
By the way, as the NPV of the Billion Dollars is really only $250m, (and that’s not even including the idea that you could die and not collect the bulk of it), and since the odds are 1/1,000 that they’ll give it away, their “average” payout will be $250,000 on that billion dollars. So the million dollar prize is actually a substantially larger piece of the prize package.
I wonder what WB is paying to cover the event. Also, as it’s in Orlando I wouldn’t be surprised if this thing is held at Disney World, and if so no doubt Disney is paying them as well. I wonder if Pepsi could even make money on this give-away.
Bill H., the odds of winning a million dollars is 1/1000 once you’ve made the show. The odds of winning the billion dollars is 1/1,000,000. Multiple each of those numbers by the number of total entries, and you’ve got something close to 0.
I think I’ll go hit on Natalie Portman. My chances look really good to me right now.
The odds of SOMEONE winning something from the last 1,000 contestants is 100%… someone will get 1 million dollars.
There are 1,000,000 combinations of a 6 digit number (0-9 = 10 6 columns so 10^6).
There will be 1,000 distinct numbers. Or .1% of the total combinations.
The collective odds of SOMEONE picking the 1 billion dollar number – is 1:1000
Assuming that everyone in the country enters the contest: lets say since it’s easier to work with300 million people (which is allowable under the rules) that you will be one of the 1000 people selected is 1:300000. Assuming that everyone has the same number of entries… Probably you’ll have only maybe 100 million people responding and if 80% of them enter 300 entries 15% enter 200 times 4% enter 100 times and 1% enter 10 times you’ve got 27 billion 410 million entries… and if you enter once you’ve got a 1000 in 27,410,000,000 chance of being selected… or a 1:27 million chance
After you get to the game show, you’ve got a 1:1000 chance of winning 1 million dollars.
Or a 1:27 BILLION chance of winning with the second example. Or 1:3 million chance using the first example.
The odds of winning 1 billion dollars would be 1000 times greater.
Or 1:27 TRILLION and 1:3 BILLION
We haven’t even looked at the odds of GETTING a game piece yet, those need to be factored in which makes things ever chancier.
You’re better off hoping to win 15$.
As for the payment schedual.
It LOOKS as if they are using the same interest scheme the state lottos use.
I mean think of how much money they’ll make from the sale of pepsi products… They’ll simply use the interest from what they sold to pay people off
The marketing guru behind this is a friggin genius. I mean, you tell people you’re giving away $1 billion, but make it so difficult that you know you’ll never have to pay up.
Oh, Pepsi will make money on this contest. Why else would they do it? They’re a corporation, not philanthropists.
Happy
Munch wrote
I’m not sure what we’re in disagreement about. Perhaps it was my reference to the odds being 1/1,000 that they’ll give away the (so-called) billion. I was referring to the odds of them giving it away to anybody, not the odds of them giving it away to a given entrant. Which is in fact 1/1,000.
By the way, I’m sure you meant divide by the number of entrants.
CRorex wrote
That’s what I said as well.
False assumption
False assumption
This is an interesting exercise, but how on earth did you come up with that? You literally could be off by a factor of 100.
Too many random assumptions for this to be valid. Also, this number smells wrong, as if you enter 300 times (as you propsed 80% of the rest of the people would), you’d have about a 1:100,000 chance of being selected which sounds way too easy.
A game piece isn’t required.
Very very different. A typical lotto payout is distributed evenly over 20 years. Which (at 4.5%) is equivalent to 65% of the money up front. I.e. if they say you win a billion dollars at Lotto, typically you’re really getting $650m. The pepsi thing is spread over 40 years and severely backloaded in a couple ways, bringing the equivalent net present value (again at 4.5%) to just under 24%, or $240m. And that’s not even to mention that the odds are certainly much higher then zero that a given contestant will die before the 40 years is up, losing a very large chunk of the money. In fact, if you die in the 39th year, you’ll only have received the NPV of under 12% or $120m.
Nothing to sneeze at mind you. But $120m is a very different number from the $650m you’d get from winning lotto.
The contestant may lose by dying early, but it’s not going to do Berkshire Hathaway any good. They’re obligated to make the full payment, either to the original winner or “their heirs, executors and assigns”.
The rule set doesn’t say one way or another. Perhaps by not saying they’re obligated to pay it out. Perhaps the actual contract says differently. I dunno.
Didn’t youse guys read the rules? You can opt for a one-time $250,000,000 payoff. So now I’m pretty much assured of winning, I think.
I have to go order some catalogs now…