We investigate the optimal number of tickets an expected-utility-maximizing individual who participate in a lottery will buy. We show that the expected utility is not always unimodal in the number of tickets. We also show that a risk-averse individual will not buy more than one ticket. (S)he will be willing to own a share in several tickets only if that share is sufficiently small.
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* We are grateful to a referee for helpful comments. Research ~,as supported by the Natural Sciences and Engineering Research Council of Canada through Grant A5698.
- expected utility