You have a way with words, Scheherazade.

You have a way with words, Scheherazade.

Friday, February 17, 2012

St. Petersburg Paradox: Daniel Bernoulli





Suppose you are offered the chance to play the following game. A fair coin will be tossed until a head appears. If a head occurs for the first time on the n^th toss then you will be paid 2 n dollars. How much would you be willing to pay to play this game?

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