538 Riddler: Betting on Cubs to Win!
02 October ’16
I approached this week's Riddler by building a decision tree from the bottom up. Let's start with the easiest case: betting on game 7. At this point, we must be net-even in betting, and we must wager $100 on the Cubs to win. Knowing this, we can extrapolate how we need to bet on the 2-3 and 3-2 games. In the 3-2 game, we need to have won $50 thus far, and we need to wager $50 on the Cubs to win. If the Cubs do win, we will have won $100. If the Cubs lose, then we'll be back to even, and we'll be in the aforementioned game 7 scenario. Working backward, we can deduce how we must bet in each of the 16 possible scenarios. Interestingly, we will bet $31.25 on the first and second games no matter what.