How is house edge defined in a casino game?

• A. The variance of outcomes across a session
• B. The house's cut on every bet
• C. The advantage built into the game's rules that ensures the operator's long-term profitability
• D. The maximum payout limit per round

Answer: (C)

House edge is the built-in mathematical advantage in a casino game, expressed as the percentage of each bet the house expects to keep over the long run. It comes from the rules and payout structure of the game. For example, in European roulette a straight-up bet on a single number pays 35 to 1, but there are 37 possible outcomes, so the expected loss per unit bet is about 2.7%. In American roulette the extra 0 and 00 increase that expected loss to about 5.26%. This edge represents the operator’s long-term profitability because, with many bets, the average loss per bet converges to the edge percentage. It’s about expected value, not the short-term swings or a fixed fee on every bet. The maximum payout limit can shape potential winnings, but it doesn’t define the long-run advantage by itself.