1. Spring ‘10 Term Project Casino Game Overview

2. Slot Machines
Most popular and most profitable -> more than 60% of the annual gaming profits in United States

3. The Game
Player inserts a coin and pulls a handle to rotate a series of reels that have pictures printed on them
Winning or Losing is determined by what pictures line up with the pay line (a line in the middle of viewing window)
If each reel shows the same picture along the pay line, the player wins
Payout depends on which pictures land along the pay line
Typical payout ranges from 82% - 98%
Reels are typically 3 in number
Certain single images are sometimes winners as well

4. How Casinos Make Money on Slots Colorado Payback Percentages
Bet
Black Hawk
Central City
Cripple Creek
1¢ Slots
90.50% 
91.05%
91.82%
5¢ Slots
93.18%
93.77%
93.36%
25¢ Slots
94.33%
94.75%
95.19%
$1 Slots
94.84%
95.63%
95.16%
$5 Slots
95.42%
94.43%
94.90%
All
93.08%
93.63%
93.88%
The best returns for each category are highlighted in bold print

5. How they work?
Random Number Generator (RNG) is the heart of slot machine
Computer uses an algorithm to determine the appropriate reel spot
Machines run continuously to defeat pattern recognition

6. How to Play Slot Machine?
Demo
How to Play Slot Machine?

7. Video Poker

8. The Game
Player places a bet of one or more credits by inserting money in to the machine
Player presses a “Deal” button to draw cards
Player can either keep or discard one or more cards in exchange for a new card drawn from virtual deck
Machine evaluates the combination of cards
Payout offered varies depending on the cards combination and posted pay schedule
Virtual deck – Deck of cards displayed on the computer screen

9. Casino Strategy Consider a 5 card video poker game also known as hand
A deck consists of 52 cards
Selecting 5 cards out of 52 in any order yields:
Casino picks up a few hands out of all possibilities and determines the payout
Payout is determined according to the quality of hands
Hand – A combination of 5 cards in a video poker game
Quality of hands – Card combinations ranked in order of hierarchy

10. Hand Categories Royal flush Straight flush Four of a kind Full house
Three of a kind
Two pair
Jacks or better
Hand Categories are in the descending order of payout

11. How Casinos Make Money on Video Poker - The Payout
Hand
Payout
Royal flush
800x
Straight flush
50x
Four of a kind
25x
Full house 9x
Flush 6x
Straight 4x
Three of a kind 3x
Two pair 2x
Jacks or better 1x
Payout multiple is determined by the casino
Payout always less than the odds of achieving the hand
Royal flush (A-K-Q-J-10) has the highest payout
Jacks or better (AA, JJ, QQ, KK) in the 5 card combination has the lowest payout
Payout multiple – Player investment multiplied by a whole number
Example: If a player wins a royal flush the casino pays 800 times the amount invested by the player

12. Gamer Strategies
Always hold the card combinations mentioned in the payout table
With 3 of a kind opt for a new combination of 2 cards to win a full house
With 2 pairs of cards discard the 5th card for a chance at a full house
Break up a flush or a straight only when you have 4 cards to a royal flush
Ex: If you have A-K-Q-J-9 all of clubs, discard 9 to take a chance for Royal flush if you get a 10 of clubs
Break up a pair of jacks or better if you have 4 cards to a royal flush or 4 cards to a lower straight flush
Keep a low pair (say 2-2) instead of a single high card (J, Q, K or A)

13. Demo
How to Play Video Poker?

14. Blackjack

15. Objective Blackjack - Combination of ace and ten-value card
Aim of the Game: ‘Beat the Dealer’
If your Cards total > Dealer's Cards without going over 21, you win
Blackjack is not about getting a 21 or getting as close to 21 as possible

16. Rules of the Game 15 Values: 2 - 10 – Valued at Face Value
Jack, Queen & King – 10
Ace :“Fluctuating” Value of both 1 and 11 (More on it later…)
The total of any hand is the sum of the individual card values in the hand
5 Face Value
10 Face Value
1/11 Face Value
Soft: It cannot be busted with the draw of any one card
Hard: It can be busted with the draw of any card
This “fluctuating” ace value can cause confusion in the early stages of acquaintance with the game.  15
5 Face Value
10 Face Value

17. Rules Continued… Soft Hand: Hard Hand:
If Current Total <= 10, then Ace = 11
Example:
2+4+A = 17;
7+3+A = 21
Hard Hand:
If Current Total > 10, then Ace = 1
7+4+A = 12
Current total of card

18. Rules Continued… Blackjack Table: Semi Circular Table
Chips must be bought from the dealer or from another table
Player puts his bet in the Betting Circle
After all bets are made, the play begins

19. The Real Deal – Playing the Game
You receive two cards face up
Dealer receives one face up and one face down Card
Down-Card - Hole Card
Dealer usually checks his hand(Peeking) for a Blackjack
Your Cards
Dealer Cards

20. The Real Deal – Playing the Game
After you look at your initial two cards and see the value of one of the dealer’s two cards, you must make a playing decision. This includes the following:
Hit: You want the dealer to give you another card
Standing: You are satisfied with the total of the hand and do not want any more cards
Surrender: You may give up your hand immediately and receive half of your initial bet back

21. The Real Deal – Playing the Game
Some more Rules
Doubling down: You can double your bet in return for receiving one and only one draw card
Pair Splitting: When you split you must make another bet equal to your original bet. By pair splitting, you play each card as a separate hand and you can draw as many cards as you like to each hand
Double Down - He may take no more than that one extra card
Pair Splitting

22. Some Key Facts
Unlike you, the dealer in blackjack has no playing option
A dealer must draw another card when his hand totals less than 17
A dealer must stand when the total is 17 to 21
If your hand total
>Dealer’s Hand, then you Win and get paid at 1:1 odds
= Dealer’s Hand, the hand is Tie and you get your chips back
> 21, you Lose

23. How Casinos Make Money on Blackjack
Casino may loose on any one hand/player
Over multiple hands/players the odds favor the casino
Good card counting can tip
the odds in favor of the
player
Not illegal but aggressively
“discouraged” by the
casino

24. Videos
Online Blackjack Practice
Online Blackjack Tutorial

25. Poker

26. Objective Poker – Best hand of 5 cards based on predetermined rules
Aim of the Game: ‘Player with highest-ranking hand wins’
Multiple Variations such as Texas Hold’em, Omaha, Stud and more…
Texas Hold’em: Most popular variant
Highest Ranking Hand = 5 Best Cards

27. How Casinos Make Money on Poker
Players compete against each other, not the casino
Dealer takes a percentage of the pot as the casino’s profit
The “rake” is generally 5-10% of the pot
Dealer removes chips while the hand is played
Highest Ranking Hand = 5 Best Cards

28. Rules of the Game Values: Ace :Highest Value Deuce/2: Lowest Value
The suits have no ranking; they are all equal
Lowest Value
Highest Value

29. A B A B Hand Ranking High Card One Pair
Hand A (Ace high) beats Hand B (King high)
One Pair A B
Hand Rankings remain the same for all forms of Poker
High Card:
In the event of 2 people both having nothing, the hand with the highest card wins
If two hands have the same high card, the next highest card is the deciding factor
One Pair :
In the event of two people both having a pair, the hand with the highest pair wins
Hand B (pair of Kings) beats Hand A (pair of Queens)

30. Hand A (three Tens) beats Hand B (three Eights)
Hand Ranking
Two Pair A B
Hand A (Pair of Kings, pair of Threes) beats Hand B (pair of Queens, pair of Jacks)
Three of a Kind A B
Hand Rankings remain the same for all forms of Poker
Two Pair:
It is the highest pair which is the deciding factor.
If two hands have the same two pair it is how high the fifth card (or kicker) is which is the deciding factor
Three of a Kind :
It is the highest three of a kind that wins
If two hands have the same three of a kind, it is the kicker which is the deciding factor.
Hand A (three Tens) beats Hand B (three Eights)

31. B B A A Hand Ranking Straight Flush
Hand B (King high straight) beats Hand A (Seven high straight)
Flush A B
Straight:
Five consecutive cards (any suit) in a row
If two players both have a straight, it is the player with the highest straight who wins
A combination of A Cards is the only time when the value of Ace is 1
Flush:
Five Random Cards of Same Suit
If two players both have a flush, it is the player with the highest flush who wins
Hand B (Ace high flush) beats Hand A (Queen high flush)

32. B B A A Hand Ranking Full House Four of a Kind
Hand B (Queens full of Twos) beats Hand A (Sevens full of Tens)
Four of a Kind A B
Full House:
It is three of a kind and a pair and a pair
The highest three of a kind is the deciding factor. If both hands have the same three of a kind, then the pair decides the winning hand.
Four of a Kind:
In the very rare occurrence of two players having four of a kind, it is the player with the highest four of a kind who wins
Hand B (four Queens) beats Hand A (four Tens).

33. B A Hand Ranking Straight Flush
Hand A (Ace high straight flush) beats Hand B (Jack high straight flush
Straight Flush:
Highest Hand in Poker Rankings
5 Consecutive cards from the same suit

34. Videos
Online Poker Tutorial

35. American Roulette

36. Roulette Wheel Layout Red and black numbers alternate
All red numbers are opposite the black numbers
Every odd number is opposite the next higher even number
Usually two odd numbers alternate with two even numbers
Most numbers are part of a pair, with one number between them. The sums of these pairs are either 37 or 39

37. Roulette Table Layout
Two sections:
Inner Section
Outer Section

38. Inner Section Contains individual numbers presented on the wheel
‘Rows’ have 3 numbers
‘Columns’ have 12 numbers

39. Outer Section
Has betting areas which correspond to a characteristic of each number or to certain group of numbers

40. How Casinos Make Money on Roulette - Inside Bets
The Payoff is always less than the odds
Bet
Chip
Example Bet
Payoff
Odds
Straight Up A 30
35:1
38:1
Split Bet B
11 or 14
17:1
38:2
Street Bet C
19, 20, 21
11:1
38:3
Corner D
25, 26, 28, 29
8:1
38:4
Five Numbers E
0. 00, 1, 2, 3
6:1
38:5
Line Bet F
4, 5, 6, 7, 8, 9
5:1
38:6

41. How Casinos Make Money on Roulette - Outside Bets
The Payoff is always less than the odds
Bet
Chip
Example Bet
Payoff
Odds
Column G
Set of Column Numbers
2:1
38:12
Dozen H
25 through 36
Red or Black I
Red Numbers
1:1
38:18
Even or Odd J
Odd Numbers
Low or High K
19 through 36

42. P(win)*Payoff + P(loss)*Original bet
House Edge
House Edge – Amount the player loses on average relative to the bet
P(win)*Payoff + P(loss)*Original bet
Example (Inside Bet):
Consider an $1 inside bet (Chip A) with probability of winning: 1/38. The payoff for winning is $35 (35:1)
House Edge (A) = (1/38)*($35) + (37/38) (-$1)= -$0.053
P(loss) = 1 – P(win)

43. House Edge Example (Outside Bet):
Consider an $1 inside bet (Chip H) with probability of winning: 12/38. The payoff for winning is $2 (2:1)
House Edge (H) = (12/38)*($2)+ (26/38)*(-$1) = -$0.053
P(loss) = 1 – P(win)

44. House Edge Conclusion:
For a $1 bet of any kind the player loses $0.053 to the Casino

45. Demo
How to Play Roulette?
How to Play Roulette?
How to Play Roulette?

46. Craps

47. Objective Craps – ‘Wager on the outcome of two thrown dice’
Easy to understand game
Types of betting can be tricky
Craps is played against the casino
Act of rolling a pair of dice on the Craps table, and predicting there outcome, by placing bets or wagers on them
Several gamblers at a time
Craps is played against the dealer of the house

48. Craps Table Craps Table: Specially designed table
Left Side
Center Side
Right Side
4-5 Attendants around the table
2 Base Dealers take bets on either side of the table
Craps Table

49. Betting Come out Roll : First roll of dice Pass Line Bet
Win on 7 or 11
Lose on 2, 3, or 12; replace bet and repeat Comeout Roll
If 4, 5, 6, 8, 9, or 10 is rolled this number becomes the “point”; proceed to Point Roll
Point Roll
Win if “point” is rolled before rolling a 7; lose both bets on 7
Don’t Pass Line Bet
Opposite of Pass Line Bet
Win on 2, 3 or 12
Lose on 7 & 11
Winning the Pass Line Bet
Losing the Don’t Pass Line Bet
Losing the Pass Line Bet
Winning the Don’t Pass Line Bet

50. Betting Come Bet Place Bet If point number is known
Made any time during the shooter’s game
Predicts the next roll of dice
Win on 7 or 11
Lose on 2, 3, or 12
Place Bet
 If point number is known
Bets placed on 4, 5, 6,8, 9, 10
Win on 4,5,6,8,9,10
Lose on 7 or 11
In craps the 4,5,6,8,9, and 10 are known as the Point Numbers
Winning Place Bet

51. The Real Deal – Playing Craps
Player Places Bet
Shooter Rolls the Dice
Dice Passed to other Player Based on Shooter Rule
Dice Rolled Again and Dealer sees Winning & Losing Bets
Winning Bets Are Paid Out
Next Round of Play Begins
Shooter: Player who rolls the dice
Player take turns being the shooter
Shooter Rule: The Shooter continues to roll the dice until he 'Craps Out' by rolling a 2, 3 or 12
Shooter – Player who rolls the dice

52. How Casinos Make Money on Craps
The Payoff is always less than 100%
Casino may loose on any sequence
Over multiple sequences the odds favor the casino
Bet
Payoff
Pass
1:1
Don’t Pass
Any Seven
4:1
Place 10 to Win
9:5
Place Against 8
4:5
Hard Four
7:1

53. Tutorial
Online Craps Tutorial

54. For Next Week Quiz 2 on Wednesday On Friday
CULearn based quiz available from 7:30 – 11:30 AM
On Friday
Team sign-ups
Submit your self-elected three or four person teams to your recitation leader
Review project outline

55. Recitation Section: ____________ Recitation Leader: _____________
Team Sign-ups
Recitation Section: ____________
Recitation Leader: _____________
Team Member 1: ______________
Team Member 2: ______________
Team Member 3: ______________
Team Member 4: ______________
Remind the students what there recitation section number is and remind them of your name (many will have already forgotten).
On Friday, 1/29 students will turn in these forms with one, two or all three team members listed. Have them print out this slide from the recitation lectures on CULearn.
Only one form per team is necessary.
RLs will create teams for individuals not associated with full three member teams – will report back during recitation of 2/5.
Report to Keith/Jim the final results of the teams by Tuesday, 2/2.