I doubt this is the case for most of the people who would take the $500 - I’d assume it’s more that most of them couldn’t or just didn’t think to calculate the expectation value of a 15% chance at a million.
I think people are flipping the offer in their minds and comparing a sure $500 to an 85% chance of zilch.
I doubt this is the case for most of the people who would take the $500 - I’d assume it’s more that most of them couldn’t or just didn’t think to calculate the expectation value of a 15% chance at a million.
I think people are flipping the offer in their minds and comparing a sure $500 to an 85% chance of zilch.