So if it accepts $1 million in wagers over 2 million spins, it would be expected to pay out $900,000, resulting in a casino gain of $100,000. This means that over the long run, the game will return 10 percent of all wagers it accepts to the casino that owns it. For an individual player, his or her limited interaction with the game will result in a “price” that looks a lot different.įor example, consider a game with a 10 percent house advantage – which is fairly typical. Basically, it’s the long-term edge that is built into the game.
Which means the law of supply and demand breaks down.Ĭasino operators usually think of price in terms of what is known as the average or expected house advantage on each bet placed by players. Slots may be even worse than the doctor’s office, in that most of us will never know the true price of our wagers. That is, other than visits to the doctor’s office and possibly the auto mechanic, we know the price of most products and services before we decide to pay for them. An important economic theory holds that when the price of something goes up, demand for it tends to fall.īut that depends on price transparency, which exists for most of the day-to-day purchases we make.
