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/sci/ - Science & Math

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10415341 No.10415341 [Reply] [Original]

Which offer would you take: a sure gain of $5,000, or a 50% chance to get $10,000?

>> No.10415351
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10415351

which offer brings me closer to her?

>> No.10415360

The expected payoff is the same. I’m indifferent.

>> No.10415380

>>10415341
Risk aversion makes the $5000 offer better.

>> No.10415384
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10415384

>>10415360
http://www.elem.com/~btilly/kelly-criterion/
Learn.

>> No.10415395

I need to pay off a loan shark, so 5k.

>> No.10415398

>>10415360
Brainlet retard

>> No.10415401

>>10415395
>utility function of money
Based and redpilled

>> No.10415404

5K makes no difference to my life
So 10K at 50%

>> No.10415418

>>10415404
Based but bluepilled

>> No.10415421

ill take cara desu

>> No.10415424

>>10415341
5k for certainty. I wouldn't go for 50% unless we're talking 100,000 to a million +.
>>10415380
>>10415404
I don't think there's a lot of mathematical reasoning to use here. It's a judgement call, because we each have a different use and value for that kind of money.
Though if I were to try, I'd measure it like a gambling game, where in, say, 10 instances you decide on either $5000 for sure (option 1) or 50% chance of 10k (option 2).
So, let's say in case x, you went for option 1 every time. That will give you an obvious 50k.
In case y, you go for option 2 every time. I'm too lazy to do the math of the probably of getting the 10k every time, etc.
But you can get some kind of an answer.

>> No.10415620

An additional $5000 has a slightly lower utility than the first $5000, so seeing as both options have an identical EV, I just take the $5000.

>> No.10415850

>>10415404
this
I'm poor, so I'd take the sure money over the 50% chance, but if I were rich I'd take the 50% chance

>> No.10415934

>>10415424
>I'm too lazy to do the math of the probably of getting the 10k every time, etc.
https://planetcalc.com/7044/

>> No.10415942

>>10415341
$10,000 because i'm not a pussy

>> No.10415976

10k

>> No.10415982

$5k
Put it all in crypto
Have $1mil EOY

>> No.10415985
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10415985

>>10415341
I'll take YOU