`#!/usr/bin/env python`

`import random`

`def flip():`

` """Simulate a coin flip."""`

` if random.randint(0,1): # Ch`

`oose this statement or the next with equal chance`

` return "Heads" # Give a "Heads"`

` else:`

` return "Tails" # Give a "Tails"`

`def lottery():`

` """Run a St Petersburg Lottery, flipping a coin until it's tails. Each time it's heads`

` our pot is doubled and added to the running total."""`

` winnings = 1 # Start with 1 pound`

` pot = 1 # The pot starts at 1 pound`

` while flip() == "Heads": # Loop until we get a Tails`

` pot = pot * 2 # Double the pot`

` winnings = winnings + pot # Add it to our winnings`

` return winnings # When we've finished looping, return the result`

`def play(rounds):`

` """Run the lottery 'rounds' times in a row."""`

` cost_per_game = 2 # Deduct this from the wealth for each round`

` wealth = 1 # Start with 1 pound`

` print "Rounds, Wealth" # Column headings for our spreadsheet`

` print "0,1" # Print the first results`

` for x in range(rounds): # Loop through each round`

` wealth = wealth - cost_per_game + lottery() # Deduct the cost and add the winnings to our wealth`

` print str(x+1)+', '+str(wealth) # Print the round number and our current wealth`

play(1000) # Play 1000 rounds

The scenario is that we start with £1 and pay a fixed sum (here £2) to play a lottery, in which a coin if tossed. If it's tails then we take the

winnings, which start at £1, but if it's heads then the winnings go up by twice the last increase, so they become £1 + £2. If we get a tails next, we get the winnings, but if we get heads it goes up by double the last increase again, so the winnings become £1 + £2 + £4. This keeps going on until we get a tails, when we get the winnings so far. The remarkable thing about this game is that the amount you can expect to win is infinite (0.5*£1 + 0.25*£2 + 0.125*£4+... = 0.5 + 0.5 + 0.5 + ...), so that you should be willing to pay any finite amount to enter. In this case the entrance fee for the lottery is £2, but it could be £2,000,000 and it wouldn't make a difference. We can see this from the graph below, where we run 1000 lotteries in a row, with 25 of these simulations running simultaneously (ie. 25,000 lotteries). The number of lotteries entered goes along the bottom, whilst the winnings goes

up the side. The 25 runs of the simulation have been superimposed on each other to better approximate what's going on (I can't be arsed working out the error bars for a blog post). At any point on the graph, the darkness is a rough estimation of the probability of owning this amount of money after this many rounds (we use the area under the curve since, if we have £50 then we also have every amount below £50).

I've also made some simulations of the Monty Hall problem, random walks (intersecting and non-intersecting) and a few other statistical phenomena. I might post them if I get time. They can be the source of pretty patterns :)

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