CNN News Clip

Phone scams happen every day in every state and over $40 billion is collected fraudulently each year using the name of police or fire departments. Even though the target groups are often the elderly (because they are likely to be home during the day), fraud is not limited to that age group. Consider George's "friendly" scam: Suppose that your friend George shows you three cards. One card is white on both sides, one is black on both sides, and the last one is black on one side and white on the other. He mixes the cards and tells you to select one at random and place it on the table. Suppose that the upper side turns out to be black. It is not the white-white card; it must be either the black-black or the black-white card. "Thus," says George, "I'll bet you $1 that the other side is black." Would you play? Perhaps you hesitate. Now George says he feels generous. You need to pay him only 75¢ if you lose, and he will still pay you $1 if he loses. Would you play now?

In this section, you'll learn how to analyze a variety of gambling situations. Whether you enjoy gambling and games of chance or are opposed to them and would never play a gambling game, you should find some valuable information in this section. Gambling situations range from dice, cards, and slot machines, to buying insurance and selling a home. By analyzing these games, you can show that without proper analysis a person could be destined for financial ruin, given enough time and limited resources. You can also find situations that should not be considered gambling situations in which you can't lose.