Friday, October 22, 2010

Mr. McMoneybags Approves

All American's share two defining traits:
  1. they love to eat McDonalds
  2. they love saving money
I am proud to say that the McTeam has been following this two point ideology for our entire lives, but it is just been in the last month that we have expressed our views to the world. This blog post will focus on how the McDonaldopoly team keeps to a tight budget and acts to maximize their expected value while dining at McDonalds multiple times daily.

First, lets look at a breakdown of what items the team orders. You can see in the graph below that the McMedium water is far and away the most ordered item.




We order the McMedium water so frequently because the item actually has a positive expected value. For those of us who are not statisticians, this means that by shelling out 24 cents for the water, we are actually expected to make more money than this in return, in the form of free food, pogo subscriptions, Wal-mart gift cards, etc. The chart below shows the Expected value, or EV, (calculated using a sample size of over 400 pulls) of each of the four most commonly order items.


Lets now work through a practical example of what this all means to make sure everyone understands. You can see from the chart, that a McMedium water has an EV of almost 50 cents. This means that by going in and purchasing the water for 24 cents we will on average walk out with 74 cents of goodies.  You can also see that the other items all have a negative EV. Take a large fry for example: it costs 1.99 but has an EV of about -20 cents. This means that you will walk out of McDicks with about 1.79 in prizes for every large fry you buy. Not bad if you ask us, but its no McMedium water.

It is clear that the waters offer the best value; however, the large fry is not far behind boosted by its 4 pulls/item. The team obviously advocates the waters for their great EV and health benefits, but, by no means are the large fries a bad buy. Of course, sometimes you need an actual meal, in which case an entree is reasonable (assuming you would purchase it anyway), but it is still more economically savvy to buy medium waters and a couple McDoubles.  When playing McDonald's Monopoly to win, the team advocates avoiding all items other than medium waters (assuming they are priced accordingly) or the occassional large fry, if you're feeling lucky.

Finally, you may ask ...how have we fared so far? Well I do not want to ruin the end of year surprise, but I can offer a small teaser with our current data. The team has so far racked up over 60 dollars of net winnings on McMedium waters and is close to breaking even overall. With the team trending towards a larger percentage of McMedium waters, we fully expect to be in the black by seasons end. The chart below shows how we have fared on only a few select items (the rest of the item data will be released at the end of the season).


Your Mendoza line hitter,

McHoff

2 comments:

  1. According to your net earnings graph it appears that you are already in the black thanks to the medium waters, which are over 60 dollars in the positive, while the fries, entrees, and hash browns look all approximately 10 dollars in the red, which means you are about 60 up from waters and 30 down in all other things, which already gives a positive return of $30.

    ReplyDelete
  2. Thanks for the feedback McAnonymous. It does appear that way, but only because that graph does not include all of our food purchases. It only includes: McMedium waters, Fries, Entree, Hash Browns. It leaves out McCafe drinks and some other similar items(big money pits). Alas, we are very close to being positive!

    ReplyDelete