I know this was posted 4 years ago, but I had a thought. If I was offered a certainty of $24,000 vs a 33⁄34 chance of $27,000, my preference would depend on whether this was a once-off. If this was a once-off, my primary concern would be securing the money and being able to put food on the table tonight. Option 1 will put food on the table with 100% certainty, while Option 2 will not.
If, however, the option was to be offered many times, I would optimise for greatest return—Option 2. If I miss out this month, I’ll just scrape for food until next month, when chance are I’ll get the money.
I think I just answered my own question. If my goal can be reached with $24,000, then Option 1 is the best one because it reaches the goal in one guaranteed fell swoop. However, if my goal is to make lots of money, then Option 2 is the way to go, because it makes the most over time.
That make sense to anyone?
Hi,
I’m a software engineer in Adelaide, Australia. I’ve tried to be a rationalist all of my life, but had no idea that there were actual techniques that you can learn from others. I’d simply tried to confront myself on the biases that books told me I had, with various degrees of success. I’m very excited to be here.
One thing that bothers me, though, is that I am feeling increasingly isolated from others. It used to be that I had thought just enough to be 1 inferential step ahead of others. This made me seem smart when I talked. Now, I’m more than 1 inferential step ahead in many areas for many people, and this leads to confusion and a lack of communication. Now people think I’m crazy and ignore me. Well, except for those of my friends who are coming with me on this journey. I hope being part of this community will a good social experience. And if anyone here is from Adelaide, I’d love to meet you in person!
Is there any way for a newbie to ask questions of an old hand? A few weeks ago, I read about using Bayes’ Theorem to evaluate evidence. Now, I see its use everywhere. I just read a post on Pharyngula that took what seemed like a very emotional stance on what also seemed to be able to be perfectly modelled with a Bayesian equation. Without the actual percentages, I had to make certain assumptions about relative values, but came to a surprising conclusion. Now I need someone to check my work and tell me if I did it wrong.
Anyway, I’m glad to meet you all! Avi