Hey /biz/ Would you take a guaranteed $100k or a 50-50 shot at 1mil?

I'd play the variance game and take my chances. 100k wouldnt change my life.

A better question would be: whats the minimum amount of money that would cause you to quit your job and completely change the course of your life?

$100k would change my life big time. No need to risk not getting anything.

So $100k.

>>1062716
100k, because I know what investments to get for more then a million return

>>1062716
I'm a poorfag and $100K is a lot of money to me, so $100K.

I also play the lottery

>>1062716
I'd go for the million. 100k wouldn't really change my life. At least I could buy a decent home on the wedt coast with a million.

>>1062716
1 mil.

Expected return is 100k with the 100k choice, and 500k with the mil choice.

Anyone with some background in math would choose the 1 mil easily.

>>1062716
Always make the higher EV play

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Kinzo would have picked the 50-50.

So would I.

>>1062814
Yeah right, and on average, every human on the planet has one tit and one ball. #brostatistics

Being 19, $100k is over 10 times the amount of money I have ever owned in my life, and I'm pretty damn tight with my money for my age. That $100k would change my life. I can take a chance afterwards by investing a portion of that $100k into something.

>>1062814
>muh expected value
>what is expected utility?
>what is risk aversion?

You're playing the game only once.

>>1063004
The mean would be one tit and one ball if you were including both genders and not looking at the average number of balls and tits independently

>>1063019
Idk man risking 100k for a 50-50 shot at a mil is a great deal IMO, even if you can only take it once.

>>1063035
*for each gender independently

>>1063050
Yep pretty much. Same goes here. I you could repeat the "coin toss" of 1 mil or nothing, the more the toss was repeated, the closest you would get to an average of 500 million.

But here, I'm assuming you only get to take the chance once (otherwise you might as well keep repeating the choice and pick $100,000 until you have enough.) So you go once, and whatever result you get excludes the possibity of the other. You can't win after losing or vice versa. So you have to events, both with a 50% probability which can be, but here isn't, the same as a 100% probability of a "convergent" event (both events at once, here win 1mil and win O simultaneously.)

50% I end up with nothing or 100% I come out of university debt free with $80k to spare

>>1062716
50/50 shot at 1 mil.

It depends on the setting. If a man in a suit with three briefcases shows up, Ill take 10% of million than a 50% chance to not have any windfall anyday. Now the question for me is do I have to claim this money on my taxes or is it under the table cash?

So this is the true nature of /biz/. I am so disappointed. I thought for sure everyone would go for the shot at the million. It's just basic logic to go with the expected value of $500k and /biz/ness men need to be risk takers. Honestly baka.

>>1062716
50-50 shot at 1mil, obviously. Higher expected payout.

>>1063226
See: Prospect theory. People underweight very low chance payout outcomes (hence: lottery), people overweight certain payouts versus uncertain.

>>1063232

its just a theory bro, let it go

Don't really need either so I'd got for 1 mil

>>1063226

It depends on people's life situations. If someone is broke, or in college or in a similar situation, the $100k could be transformative. - especially if they're young and invested it.

I'm in a bit more of a comfortable position with some career experience and capital saved up, so I would take the 50/50 $1m shot. But if I was, say, 19 I'd get the $100k.

>>1063259
But honestly how would 100k be life changing? You ended up making it without a windfall. I mean 100k isn't the difference between life and death for almost anyone. No one *needs* an extra 100k.

>>1062815
St. Petersburg paradox

>>1063272
Getting from 0 to 100K takes much more time than getting the next 100k, and the next, etc.. For people starting from scratch, getting a 100K out of the blue could save a good 30 years of their life, so pretty life changing if you ask me

>>1062716
100k all day

50/50
because I'd probably win

100k and blow it on hookers and blackjack

you get to fuck a solid 7 or have a 50-50 chance of getting to fuck taylor swift, both will let you do anything to them

>>1062716

Bunch of piss poor negotiators here.

You negotiate with the individual offering this deal. He has a 50% chance of losing one million dollars. Now he is offering to take a 10% loss instead of a 100% loss.

You threaten to take the shot at the million unless he guarantees you $400k, and then he'll come back at $150, you hit him at $300, and eventually you settle on 225-250k.

This way his exposure is limited and you're still guaranteed a favorable outcome.

>>1064128
>people like this think they're clever

>>1063072
50/50 you never have to work a day in your life again

>>1064031

This.

100k can definitely change your life if you're poor, so long as you play it smart and don't blow it on material goods.

It's way easier to make money if you're already have the money.

>>1064592
If you're 65 maybe. A mill ain't what it used to be.

>>1064128
>Here's my deal
>"No, sir, you're on a game show. That's the only reason these offers exist in reality. Now pick."
>but muh deal
>"Next contestant."

>>1062716
>guaranteed 1 million in a couple years or 50/50 chance of 5 million a couple of years from now

>>1062716
$100k.

>>1062716
-500k worst case scenario vs +100k worst case scenario.

100k.

100k, no doubts

>>1065100
Yes

>>1062716

Cannot understand the logic of anyone picking 100k- it's sheer insanity.

Unless you are so destitute that you 100k means you won't starve to death- and I have been there before.

If you are not there, then the 1mil 50-50 is objectively worth $500,000.

I would pay $490,000 for a 50/50 chance at 1 million- and even If I lost, I would feel secure knowing that I made a good risk.

So to accept 100k instead of 500k? No- I would buy that 50/50 1 mil from anyone here for 490k.

100k is peanuts anyways, live a little.

Everyone in this thread saying they could easily turn 100k into 1 million in a few years, how the fuck would you do that? if you could turn money over by 50% a year yearly you'd give warren buffet a run for his money and would have people investing tens of millions in your fund. Please educate me as to how you'd be doing that.


>>1065100
I made a model in matlab to test this and it is always beneficial to switch doors. I was pissed at first but it made sense after closer study and now I have a slightly better understanding of statistics.

>>1065100

What nonsense- how does this show if someone has autism?

This is just an IQ test, to separate morons from normal people- 99% of people will switch doors.

If it wasn't immediately obvious to switch doors, then just turn off your computer, get off biz, you're too stupid to start a business, I'm impressed you even put your own clothes on

>>1065130

What the fuck? You made a model to prove it? You were pissed that the obvious was proven by your model?

When you made your choice your odds were 1/3- after seeing the goat, the odds change, now switching to the other door yields DOUBLE the odds

Simple

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>>1065139
I made a model to test the possibilities of any number of doors goats or cars so I could better understand the statistics behind switching or not while practicing scripting.

You're right about the statistics but the standard way of thinking leaves people thinking it makes no difference to switch. It's usually used to showcase that people in general have a complete shit intuitive understanding of statistics.

Stop being so uppity.

>>1065148

You're a fool

It does not require an understand of statistics- it's a simple logic problem

It also doesn't require a model to understand.

.333 .333 .333

1/3rd

Then,

1/3rd - This we know. This we picked at the very start- this does not change.

The door we initially picked has a 1.3rd chance .

Now, the other 2 doors have 2/3 combined- it's clear . One is 0, the other is 2/3rd.

There is no reason for ANYONE not to understand this, or need a model to understand it

>>1065167
what are you trying to prove?

>>1065196

Nothing- I just don't get it.

When I saw the problem, I thought oh, this is ego masturbation- everyone will know to switch, and then think they are so smart for knowing to switch- not knowing that 99% of people also knew to switch.

I guess I had too much faith in the intellect of my fellow man.

I like to think that other people have brains and use them

>>1062814
I feel like there's so much more involved here than a simple "expected return".

>>1065199

That's all it is- expected return.

50/50 1 mil is worth $500,000.

If someone comes selling that for $499k, you pay them $499k, and you got a good deal.

You sure as fuck don't sell it for 100k!

>>1065199


The only other factors being the only things more important than the promise of money- having enough money RIGHT NOW to feed yourself, so you don't starve to death.

If you have that much money, then of course you pick the 1 million, because 100k won't save your life.

If you're posting in this thread on a stolen phone homeless living in a bus station, yeah, you pick the 100k.

If you know where your next meal comes from, you pick the 1 mil 50/50

>>1063004
a little less than that actually, think of all the men with one testicle/women with 1 tit only, there are not so many with 3/more

>>1062814
>Expected return is 100k with the 100k choice, and 500k with the mil choice.
>Anyone with some background in math would choose the 1 mil easily.
HOLY SHIT YOU CAN'T MAKE THIS STUFF UP
only on /biz/
and /sci/ too probably

>>1065244
>>1065200
see----> >>1064031
>>1063019
>>1065216

>>1065200
>>1065216

This is way too much of a simplification. There are many more factors to consider. Take the following example:

You can either have $1 million or a 1 in 500 shot at $1 billion. According to your theory (and I use that term generously), you would obviously take the second option because its expected return is $2 million.

But probability theory says you're not going to get those $2 million, so really this is the equivalent of paying $1 million for a 1 in 500 chance of getting 1 more million.

In the OP example, you are paying $100k for a 1/2 chance to win $400k, which is actually a solid deal, but not for the highschool tier reasons you named. It's solid because the ratio of bet and winnings is 1/4, which is lower than the win probability of 1/2, thus making your bet a good one.

>If someone comes selling that for $499k, you pay them $499k, and you got a good deal.

No, you don't have a good deal, because you're paying $499k for a 1/2 chance to have a measly $1k more, while risking the $499k. So, half the time, you would win $1k, the other half you would lose $499k. Does that sound like a good deal, champ?

You need to go back to rudimentary math and check yourself before you piss away your inheritance on retarded investments.

>>1065248

/thread

>>1065248
>No, you don't have a good deal

To clarify - the buyer doesn't have a good deal, in fact it's so terrible that nobody would be retarded enough to pay it.

>>1065100
I would stick with my choice. Don't have a driver's license and a goat can always be useful so I'd increase my chances of getting that sweet goat milk and meat

>>1065248

Oh shit.

I thought the seconds option was a 50/50 shot at $500k. Just realized now it's $1 million.

Never mind. It's obviously too early for me to biz.

Wait I feel dumb please educate me.

There are three doors and only one gets me the car. I have a 1/3 probability of getting the car with every door. I pick a door and one of the fake doors that I did not pick is revealed to me. I still don't know what's behind these two doors. Essentially the door that was revealed to me is removed from the problem and now it's 50/50 that I pick the right door. Switching makes no difference.

...Right?

Most I've had in the bank is 20k, so 100k would be great.

>>1065671
This guy explained it
>>1065167

>>1065688

How is one 0 and one is 2/3?

You don't know what's behind either door.

>>1062716

Expected value of latter option 500k, value of first option 100k

HMMMMMM TOUGHY

>>1062716
poorfag here so I would take the 100k, If I was rich I would take the 50-50 for a million

>>1062814

sadly that's not how the world works mate, anyone with any background in finance would tell you that the expected return system is flawed

>>1064125
premarital sex is degenerate, therefore I would walk away.

>>1065829
>implying there is a standard of normalcy which we are deviating from. Hey /pol/, what is normal?

>>1065772

That's not how expected values work

>>1065759
Uh he just showed you by opening the door with the goat behind it. So that door now has 0% chance of having a car. Which means the other door has 2/3.

>>1064125
>implying Swift is anything higher than a 6
You're so pleb it hurts

>>1065998
Post a 10

>>1066010

>Implying sexual preference isn't just that, a preference

50/50 at 1 million. 100k would be a lot of money to be me but not life changing amounts of money, so I'm open to the higher expected value argument.

>>1065998
There are no 10s, but if there were, they wouldnt look like Taylor Lizardwoman Swift

100k and then buy ethereum and turn it into 15 million, easy.

>>1065264

You're an idiot, we know, you don't need to tell us, it was OBVIOUS when you posted.

You should go back to rudimentary READING NUMBERS CLASS

Prick

>>1064973
>It's way easier to make money if you're already have the money.
This this this this this so much fucking this

People don't appreciate how much easier making money becomes when you already have money. Source: starting a company now. If I had about $15-20k right now, I'd be able to develop a better product, find better suppliers, reduce unit cost, and either increase profit margins on unit sales or be able to hit a lower (more accessible) price point.

Ease of doing literally anything vs access to capital is a logarithmic function. When you're at the low end of capital, everything orders of magnitude more difficult.

>>1066283
Please stop clogging up this board and posting in every thread with this shit. We get it you lost money.

>>1066360

He's the guy that pumped it from 0 he's the only one that made money

The suckers that buy it are the ones losing money

>>1066348

Strongly disagree. When I started my company I had a thousand bucks, it kept me real humble, taught me to cut costs, skrimp every penny, how to get on the phone and rip people's heads off for a 2% discount.

If I started my company with a million dollars I won in the lottery it wouldn't be the company it is today, right now.

>>1066369
I agree with that thinking, for the vast majority of people. Most people have absolutely no sense of money, how to manage expenses, how to save, nothing. For me though, I have a strong disconnect with money. Whether I'm playing with $100 or $12,000, my wants and needs don't change, I still manage it the same. Similarly with the company, whether we're making $600 a month or $20,000 a month, I'll still be treating it the same; keep costs low. Use the minimum reasonable number of employees and equipment. You don't need an office in the middle of downtown because that's fucking retarded why would you need that.

But believe me, what you said applies to 99.99% of people. Generally speaking, you're right.

>>1066369
The biggest reason given for failure in new start ups is lack of capitol. YMMV on whether these people are in denial about their own work ethic or not.

>>1062716
100,000 would change my life a lot
If i didnt win the 1 million i would literally kill myself

>>1065197
Most people don't switch because they think the host is trying to trick them into switching. People don't even believe you when you try to explain that switching is not 50/50. It's painful. How old are you? Haven't you realised you are smarter/more logical than most people yet?