MathWorks Math Modeling Challenge 2026

The M3 Challenge 2026 Problem

M3-Challenge-Problem_2026.pdf

The answer:

M3-Final-Presentation-18907.pptx
M3-Final-Presentation-18907.pdf

Problem - The Rise of Online Gambling: What’s at Stake?(short)

Gambling is a major and growing industry in both the United States and the United Kingdom, fueled by the rapid rise of online gambling. In the U.S., a 2018 ruling repealing the ban on sports betting has accelerated this growth. By 2025, American sports betting platforms generated roughly $15 billion in revenue from $150 billion in wagers. Approximately 22% of Americans hold online sports gambling accounts, with nearly 50% of men aged 18–49 participating.

While many view online sports gambling as entertaining, and leagues and governments benefit from increased viewership and tax revenues, significant concerns exist. Online betting apps lower barriers to placing bets, raising risks of addiction and problem gambling, particularly among young people. Even non-problem gamblers face financial consequences, as gambling reduces savings and increases debt.

The competition tasks help to quantify the financial impact of gambling on individuals.

Given the issues outlined above, should society be concerned about online gambling and its continued growth? You are tasked with helping answer this question by quantifying and assessing the financial impact of gambling on individuals.

• Q1: Playing With House Money Like other forms of entertainment, the amount of money an individual spends on sports gambling is tied to their disposable income (what is left over after paying for essentials like food, rent, taxes, and healthcare). Develop a model that takes as input an individual’s salary, age, and any other demographic information you deem relevant, and returns an estimate of the person’s disposable income. Your solution should include a demonstration of your model on inputs from a variety of demographic groups.

• Q2: Know the Spread The profit of sports gambling companies can be used to get a rough idea of how much total money is being lost via sports gambling in the U.S. and U.K. However, the way these losses are distributed across the population is less clear. Some demographics (ages, genders, etc.) might gamble more frequently than others. Even within demographic groups, a gambler’s risk tolerance or choice of bets can impact how much they win or lose. Create a model that predicts how much an individual will gain or lose through online sports gambling over the course of one year based on their demographics and other assumptions about the individual (e.g., their risk tolerance).

• Q3: Don’t Break the Bank From Q1 and Q2, you should have a good sense of how much individuals spend on online sports gambling compared to their disposable income. But what should society take away from these predictions? In this problem, you are tasked with quantifying the impact of spending on sports gambling in a way that is understandable to the general public. There is no single correct approach. You might choose to compare the amount spent on sports gambling to other forms of entertainment, you might quantify how gambling losses will impact long-term household savings, or you might model the percentage of people that are at risk of going into debt due to online gambling. Take these ideas as starting points and be creative.

Our team's answer: