Things Aren't Always What They Seem

We had a person who wanted to donate to Comics Help Kids Read, the charity I discussed in a separate blog, (found at www.gofundme.com/comicshelpkidsread) and he asked how much I wanted the donation to be.  I jokingly said a penny for every space on a checkerboard, but I want the penny to double for each space.  He said, "Done".  He had no idea what he was getting into.

I turned him down because what he was thinking, and what the reality of the situation was, were completely different.  Even Bill Gates couldn't make a donation that size.  (see the bottom of the blog to see what the total dollar amount would be if a penny were doubled for every space on a checkerboard).

Let me ask you a question.  If someone offered to donate $5 million right now in cash OR donate a penny each day for a month, doubling it each day, which would you take?  The smart bet is on the penny that doubles each day.  It doesn't seem logical to turn down $5 million right now for a mere penny doubling each day though, does it?  Think about it, at the end of 16 days you wouldn't have even broken $1,000 yet if you were doing the "penny a day, doubled daily" plan.

Let's talk a look because things aren't always what they seem.

Let's take a standard month of 30 days.  If we go by a penny doubled each day of the month it would look like this.

Day 1  = $.01
Day 2  = $.02
Day 3  = $.04
Day 4  = $.08
Day 5  = $.16
Day 6  = $.32
Day 7  = $.64
Day 8  = $1.28

Total donation based on days 1 - 8?   $2.55 (maybe I should have taken the 5 mil...)

Let's keep going:

Day 9    = $2.56
Day 10  = $5.12
Day 11  = $10.24
Day 12  = $20.48
Day 13  = $40.96
Day 14  = $81.92
Day 15  = $163.84
Day 16  = $327.68

Total donation based on days 1 - 16?  $655.35 (and the person who chose $5 million is out having fun and laughing at me.)

Again, let's trudge on:

Day 17  = $655.36
Day 18  = $1,310.60
Day 19  = $2,621.20
Day 20  = $5,242.40
Day 21  = $10,484.80
Day 22  = $20,969.60
Day 23  = $41,939.20
Day 24  = $83,878.40

Total donation based on days 1 - 24?  $167,756.91 (maybe I should have taken the $5 million, what could possibly happen in the next 6 days?)

Day 25  = $167,756.80
Day 26  = $335,513.60
Day 27  = $671,027.20
Day 28  = $1,324,054.40
Day 29  = $2,684,108.80
Day 30  = $5,368,217.60

I didn't even hit the $5 million dollar mark, in total dollars, until Day 29, but then I crushed the competition with a grand total of $10,550,678.40.  Yay!

If you want to win a bet this is the way to go.  Ask someone the question above; if they had a choice between $5 million now or a penny that is doubled each day for a month, which would they rather have.  Most people would pick the $5 million dollars.  But you wouldn't, would you?  Show the math and walk away with your winnings.

If you're gutsy enough you could even ask if the person would rather have $1 billion or a penny doubled for each space on a checkerboard.  The dollar value you would have in pennies after doubling 1 penny for each spot on a checkerboard (in other words, doubling it 64 times) is $184,467,440,737,095,516.15.  WOW!  That is $184 sextillion dollars!  Ah, the power of compounding...

Now I need to go out and ask someone if they're willing to donate a penny and double it for each day for a month year.  Kids would never be without books again and I might even have some left over for a couple of comics for myself.