Self-study
Professor: Economists argue that buying lottery tickets is an unwise use of resources, because the average payoff for the tickets sold in a lottery is much lower than the cost of a ticket. ███ ████ █████████ ██ ███████ ███ ███████ ██████ ████ ███ ██ ██████████ █████████ ████████ ██ ████ █████ ████ ███ ███████ ████ ██ █ ███████ ███ ██████ █████ █████ ████ ██████████ █████████ ██ ██ ██████ ███ ██ ██████████
Summarize Argument
The author concludes that the fact the average payoff for a lottery ticket is much lower than the cost of a ticket does not prove that buying lottery tickets is unwise. The author supports this conclusion by comparing lottery tickets to insurance policies. The average amount paid on these policies is much lower than the average cost of a policy, but people don’t think buying insurance is unwise.
Notable Assumptions
The author assumes that buying an insurance policy is relevantly similar to buying a lottery ticket.
19.
Which one of the following, ██ █████ ████ ███████ ███ ███████████ █████████
a
Individuals spend, on ████████ ████ ████ ██ █████████ ████ ██ ███████ ████████
If anything, this answer helps defend the argument from the possibility that the amounts spent on lottery tickets might be so large as to involve far more risk than that involved with insurance policies. (A) says this isn’t true.
b
Insurance companies generally ██████ █ ██████ ██████████ ██ █████ ███████ ████ ██ █████████████ ████ ███████ ██████████
The argument is about what is unwise for the purchaser. Whether the seller of lottery ticket benefits has no bearing on whether the purchaser is making a wise decision.
c
Taking small financial █████ ███ █████ ███████ ████████ █████ ███████ ██ █████████ ████ ██████ █████████
This doesn’t undermine the author’s analogy. (C) simply describes the risk/reward aspect of a lottery ticket. But we’re interested in weakening the author’s analogy to insurance policies.
d
In general, the ████ ██ ███████ ███ █████ █████ ██ █ ███████ ███ █████████████ █████ ████ ███ ████ ██ ██████████ █ ██████████ ████ █ ███████ █████████ ███████
The comparative odds of winning a ticket vs. collecting on an insurance policy aren’t relevant, because we already know that the average payout on a lottery ticket and an insurance policy is lower than the average cost.
e
The protection against ████ ████ █████████ ████████ ██ ████ █████████ ██ █████ ██████████ ████ ██ ███ ███████████ ██ █ ████████ █████
This points out a difference that affects the analogy. If the benefit of insurance is more important than the benefit of a lottery ticket, then the fact people don’t think insurance is unwise may not be as relevant concerning an evaluation of whether lottery tickets are unwise.