The Massachusetts Lottery Commission reported that in 2006 they distributed over $761 million in Direct Local Aid to the cities and towns of the Commonwealth.

What happens to the revenue which the Lottery generates from sales?

1. (a)A minimum of 45% of revenues stays in the State Lottery Fund to be paid out inprizes. The Lottery's current prize percentage is over 69.
2. (b)A portion of revenues is transferred to the commonwealth's General Fund forthe expenses incurred in administering and operating the Lottery. The administrative and operating expenses of the Lottery are appropriated by the legislature as part of the annual state budget. Operating expenses cannot exceed 15%. Currently, operating expenses are under 8%. These operating expenses include 5.8% in commissions and bonuses paid to the sales agents who sell the tickets and under 2% in administrative expenses due to Lottery operation.
3. (c)After prizes and expenses, the remaining Lottery revenues (approximately 23%) is transferred to the Local Aid Fund and returned to the cities and towns of the Commonwealth in the form of local aid.

Several years later, on January 5, 2011The Boston Globereported that Massachusetts lottery agents have sold about $26 million in tickets over the course of this 16-draw series, which has failed to produce a jackpot winner. The tickets have raised $11 million for cities and towns.

1. (a)Sketch a pie chart showing how the money collected by the Lottery Commission was distributed among the three categories prizes, overhead and aid to cities and towns. Label each slice with its percentage, and one of the slices with an amount of money.
2. (b)What was the fair price of a $5 ticket?
3. (c)What was the total dollar amount collected by the Lottery Commission in 2006?