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From: mike@amdcad.UUCP (Mike Parker)
Newsgroups: net.consumers
Subject: Re: Question about Sweepstakes
Message-ID: <7951@amdcad.UUCP>
Date: Fri, 3-Jan-86 20:41:33 EST
Article-I.D.: amdcad.7951
Posted: Fri Jan  3 20:41:33 1986
Date-Received: Sat, 4-Jan-86 17:11:12 EST
References: <474@iheds.UUCP> <829@bu-cs.UUCP>
Reply-To: mike@amdcad.UUCP (Mike Parker)
Organization: AMD, Sunnyvale, California
Lines: 20

In article <829@bu-cs.UUCP> bzs@bu-cs.UUCP (Barry Shein) writes:
>Re: How do they make money on those $10M sweepstakes selling magazines?
>	-Barry Shein, Boston University


I just saw a interesting calculation of the California Lottery
situation. I don't remember the details but if you win two
million dollars they only give you $100K per year for 20 years.
So just for fun lets say they put the other 1.9M$ in the bank
or a money market fund making say 10%. In a year when they owe
you another $100K, they've made $190K in interest.

You know how those $10M magazine sweepstakes always come with some
bank's gearantee of "sufficient funds on deposit"? Most of those
sweepstakes are also $X per year for 20 years, so "sufficient funds
on deposit" is nowhere near $10M. I'm not saying they don't sell
mailing lists too, but I am saying that those sweeps don't cost
as much as the prizes are big.

Mike