I don’t understand because not that many people actually buy these. I don’t understand where they get such large sums of money so often.
In: Economics
You don’t instantly get $500 million if you win it. And people don’t win it every time, either.
Either they push the annuity on you (paid out over X period of time) in which case they hold onto the majority of the funds which they can invest for nice returns and then pay you out over a long time
Or you take the cash deal which means the $500 million is significantly discounted.
When they’re holding the funds, they can pool a ton of money into investment and use that to fund winner payouts
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