How does the lottery work?


How does the lottery work?

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ELI5: Charge 100 people $1 each to buy a lottery ticket. Pick the numbers, get a winner. Pay the winner $80. Keep the $20 to run the lottery and pay the staff.

Sell 100,000 tickets at $5 each, that’s $500,000

Take $50,000 that week to pay staff, equipment, and keep the operation running

That leaves $450,000 to add to the prize pool

That pool accumulates until someone wins big (which is rare)

Government scrapes taxes off the top of everything