Longtime reader Anonymous says he would give up a sure win of $1,000 to have a fifty–fifty chance of winning a million dollars, but he would take a sure win of $60,000 and give up a fifty–fifty chance of winning $200,000. Probably many people would choose the same, as each choice maximizes the expected value of its scenario. In the first, Anonymous is taking the expected value of $500,000 (50% × $1 million) vs the lesser expected value of $1,000 (100% × $1,000). In the second scenario, Anonymous is taking the expected value of $60,000 (100% × $60,000) vs the lesser expected value of $40,000 (20% × $200,000).
All is well when the choices are straightforward, as with those scenarios. But where exactly is Anonymous's price? Can we make him squirm? Here are some questions to pin him down.
Note: It's assumed that any remaining, unidentified probability in a scenario results in nothing gained and nothing lost. For example, a 60% chance of winning $1,000
means also having a 40% chance of winning nothing and losing nothing.
Would you rather…
- …have a 100% chance of winning $1,000 or a 10% chance of winning $1 million?
- …have a 100% chance of winning $1,000 or a 1% chance of winning $1 million?
- …have a 100% chance of winning $1,000 or a 0.1% chance of winning $1 million?
- …have a 100% chance of winning $1,000 or a 0.05% chance of winning $1 million?
- …have a 100% chance of winning $1,000 or a 0.01% chance of winning $1 million?
Would you rather…
- …have a 50% chance of winning $1,000 or a 10% chance of winning $1 million and a 90% chance of losing $1,000?
- …have a 50% chance of winning $1,000 or a 1% chance of winning $1 million and a 99% chance of losing $1,000?
- …have a 60% chance of winning $1,000 and a 40% chance of losing $1,000 or a 1% chance of winning $1 million and a 99% chance of losing $1,000?
- …have a 70% chance of winning $1,000 and a 30% chance of losing $1,000 or a 1% chance of winning $1 million and a 99% chance of losing $1,000?
- …have a 80% chance of winning $1,000 and a 20% chance of losing $1,000 or a 1% chance of winning $1 million and a 99% chance of losing $1,000?
- …have a 90% chance of winning $1,000 and a 10% chance of losing $1,000 or a 1% chance of winning $1 million and a 99% chance of losing $1,000?
Would you rather…
- …have a 100% chance of winning $60,000 or a 20% chance of winning $300,000?
- …have a 100% chance of winning $60,000 or a 20% chance of winning $310,000 and an 80% chance of losing $2,500?
- …have a 100% chance of winning $60,000 or a 20% chance of winning $320,000 and an 80% chance of losing $2,500?
- …have a 100% chance of winning $60,000 or a 20% chance of winning $350,000 and an 80% chance of losing $2,500?
- …have a 100% chance of winning $60,000 or a 20% chance of winning $400,000 and an 80% chance of losing $2,500?
What's the most you would pay to…
- …have a 1% chance of winning $1,000?
- …have a 50% chance of winning $1,000?
- …have a 99% chance of winning $1,000?
- …have a 1% chance of winning $1,000,000?
- …have a 50% chance of winning $1,000,000?
- …have a 99% chance of winning $1,000,000?
What's the most you would pay to…
- …not have a 1% chance of losing $1,000?
- …not have a 50% chance of losing $1,000?
- …not have a 99% chance of losing $1,000?
- …not have a 1% chance of losing $10,000?
- …not have a 50% chance of losing $10,000?
- …not have a 99% chance of losing $10,000?
See also:
4 comments:
1.… 10% chance of winning $1 million
2.… 1% chance of winning $1 million
3.… 0.1% chance of winning $1 million
4.… 0.05% chance of winning $1 million
5.… 0.01% chance of winning $1 million
6.…10% chance of winning $1 million and a 90% chance of losing $1,000
7.…1% chance of winning $1 million and a 99% chance of losing $1,000
8.…1% chance of winning $1 million and a 99% chance of losing $1,000
9.…1% chance of winning $1 million and a 99% chance of losing $1,000
10.…1% chance of winning $1 million and a 99% chance of losing $1,000
11.…1% chance of winning $1 million and a 99% chance of losing $1,000
12.…have a 100% chance of winning $60,000
13.…have a 100% chance of winning $60,000
14.…have a 100% chance of winning $60,000
15.…have a 100% chance of winning $60,000
16.…have a 100% chance of winning $60,000
17.…$1 to have a 1% chance of winning $1,000?
18.…$100 to have a 50% chance of winning $1,000?
19.…$200 have a 99% chance of winning $1,000?
20.…$10 have a 1% chance of winning $1,000,000?
21.…$1000 to have a 50% chance of winning $1,000,000?
22.…$10,000have a 99% chance of winning $1,000,000?
23.…$1 to not have a 1% chance of losing $1,000?
24.…$10 to not have a 50% chance of losing $1,000?
25.…$100 to not have a 99% chance of losing $1,000?
26.…$10 to not have a 1% chance of losing $10,000?
27.…$500 to not have a 50% chance of losing $10,000?
28.…$1000 to not have a 99% chance of losing $10,000?
Would you rather…
1.…have a 100% chance of winning $1,000 or a 10% chance of winning $1 million? 10% @ 1M
2.…have a 100% chance of winning $1,000 or a 1% chance of winning $1 million? I'll take the 1k (I think these say as much about how much one could presently have in their bank account as they do about the answerers mentality)
3.…have a 100% chance of winning $1,000 or a 0.1% chance of winning $1 million? taking the 1k again
4.…have a 100% chance of winning $1,000 or a 0.05% chance of winning $1 million? 1k
5.…have a 100% chance of winning $1,000 or a 0.01% chance of winning $1 million? 1k
Would you rather…
6.…have a 50% chance of winning $1,000 or a 10% chance of winning $1 million and a 90% chance of losing $1,000? taking 1k
7.…have a 50% chance of winning $1,000 or a 1% chance of winning $1 million and a 99% chance of losing $1,000? 1k again
8.…have a 60% chance of winning $1,000 and a 40% chance of losing $1,000 or a 1% chance of winning $1 million and a 99% chance of losing $1,000? anything to avoid the 99% loss of 1K (yes, the K goes capital when it's already mine)
9.…have a 70% chance of winning $1,000 and a 30% chance of losing $1,000 or a 1% chance of winning $1 million and a 99% chance of losing $1,000? still avoiding loss
10.…have a 80% chance of winning $1,000 and a 20% chance of losing $1,000 or a 1% chance of winning $1 million and a 99% chance of losing $1,000? same as #9 (yes, I'm trying to make this as difficult for you to analyse as it is for us to answer this insane volume of questions!)
11.…have a 90% chance of winning $1,000 and a 10% chance of losing $1,000 or a 1% chance of winning $1 million and a 99% chance of losing $1,000? 90/10
Would you rather…
12.…have a 100% chance of winning $60,000 or a 20% chance of winning $300,000? 60k
13.…have a 100% chance of winning $60,000 or a 20% chance of winning $310,000 and an 80% chance of losing $2,500? 60k
14.…have a 100% chance of winning $60,000 or a 20% chance of winning $320,000 and an 80% chance of losing $2,500? 60k
15.…have a 100% chance of winning $60,000 or a 20% chance of winning $350,000 and an 80% chance of losing $2,500? 60k
16.…have a 100% chance of winning $60,000 or a 20% chance of winning $400,000 and an 80% chance of losing $2,500? 60k
What's the most you would pay to…
17.…have a 1% chance of winning $1,000? $1
18.…have a 50% chance of winning $1,000? $50
19.…have a 99% chance of winning $1,000? $500
20.…have a 1% chance of winning $1,000,000? $10
21.…have a 50% chance of winning $1,000,000? $1000
22.…have a 99% chance of winning $1,000,000? $100,000
What's the most you would pay to…
23.…not have a 1% chance of losing $1,000? $10
24.…not have a 50% chance of losing $1,000? I don't like this game anymore...$100
25.…not have a 99% chance of losing $1,000? (#$*#&@#*
26.…not have a 1% chance of losing $10,000? $10
27.…not have a 50% chance of losing $10,000? $1000
28.…not have a 99% chance of losing $10,000? I'm just confused at this point...I guess $5k
I wonder how this data will be utilized?
Anonymous—Me too.
Thanks, both of you, for taking the time to answer this survey. As compensation for your effort, you've both been entered into a lottery whereby you'll each have a 1% chance of winning $1,000,000 and a 20% chance of getting struck by lightning.
After running the numbers in a spreadsheet, I've concluded that Bobby et al. is risk averse and Anonymous is a moon shooter who hates paying for insurance. I think both of these traits are in line with your online behaviors—those being that Bobby et al. is a Presidential Scholar and Anonymous is a guy—um, or gal—who's still trying to hide his, or her, identity on the Internet.
But seriously, Anonymous, you wouldn't pay $1,001 to avoid a 99% chance of losing $9,900?
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