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Old 05-14-2008, 01:07 AM   #1 (permalink)
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Default Interesting Theoretical Question About $$$

Some poker players I met posed an interesting theoretical question. I think it's best to answer this question without any influence from the answers of others. I'm going to make a ton of space between the question and my answer. Before scrolling down to read anyone's answer, post your own answer. I think it'll be interesting to see how you answer varies from everyone elses in a vacuum.

The question: You can either have a.) X amount of money or b.) the chance to flip a coin where you either win $0 or $1 billion. What is the lowest value of X in which you will choose the first option? Take some time to come up with your answer.
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My Answer: $8 million

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Old 05-14-2008, 03:12 AM   #2 (permalink)
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50 million

#YOLO

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Old 05-14-2008, 04:13 AM   #3 (permalink)
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1.1 BILLION

there is little I wouldn't do for a dolphin.
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Old 05-14-2008, 05:34 AM   #4 (permalink)
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$10 million


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Old 05-14-2008, 06:06 AM   #5 (permalink)
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100 Million.

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Old 05-14-2008, 09:10 AM   #6 (permalink)
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I figure the idea of this is that a billion is pretty much an infinate amount of cash, in theory you should go for half, but thats not the point of it at all.
I'd take enough for my family to live off, probably around $12 mill

there is little I wouldn't do for a dolphin.
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Old 05-14-2008, 09:53 AM   #7 (permalink)
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35 million. I realize that this is giving up a lot math wise...but, really, a locked 35 million pretty much ensures a sexy standard of living for the rest of my life.
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Old 05-14-2008, 09:54 AM   #8 (permalink)
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Wow, most people's answers are quite a bit lower than I thought they would be.
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Old 05-14-2008, 10:30 AM   #9 (permalink)
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Originally Posted by Orgazmo View Post
35 million. I realize that this is giving up a lot math wise...but, really, a locked 35 million pretty much ensures a sexy standard of living for the rest of my life.
My response to this is: ... and $8 million doesn't?

I know what you mean though. When I was asked this question, I was around some ballin' motherfuckas so I prefaced it by saying "wow... I probably sound like a huge pussy, but I'd say like $8 million." They were all like, "no... no... most of us said around like $10 million too."

I'll bet if you think about it, your answer is probably quite a bit less than $35M. Like, pretend this whole proposition is actually thrusted upon you. Do you actually see yourself saying no to $10M to flip the coin?
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Old 05-14-2008, 12:16 PM   #10 (permalink)
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Ya, you're probably right. My initial answer was 50...and then I thought about it more and downed it a bit. Even still, I figured I was lower than most. You have a point, though. 8 mil could probably do the deed.
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Old 05-14-2008, 12:35 PM   #11 (permalink)
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Shit, I'd say 2 or 3 million on the high side, it would more than cover a reasonable lifestyle or be a great nestegg for your children or family or whatever if you are a pussy. High risk aversion I guess.

I think alot of you would lower your cost in reality, especially if the person was offering the money as a yes or no proposition and not willing to negotiate.
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Old 05-14-2008, 02:18 PM   #12 (permalink)
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Thats going to be a life-changing amount of money. Something as low as 1% of that amount you could live extremely well on for the rest of your life. I would say that there is a huge "law of diminishing returns" at some point. That will vary with each person, I would probably set the number $10M.


Also, I wonder how many people would take the coinflip regardless of their financial situation, just because they are freerollin' for a Billion.

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Old 05-14-2008, 04:29 PM   #13 (permalink)
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500 Million
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Old 05-14-2008, 04:53 PM   #14 (permalink)
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I re-read the question. That's a tough call.


Probably 50 mil..
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Old 05-14-2008, 08:48 PM   #15 (permalink)
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So I wonder if I can reason this out... I've often asked myself: "What is greatest risk in % terms that I would take for $1 billion if the losing scenario was an instant painless death?"

And I honestly think I'd put it at between 30-50%, yet in your scenario I'd take the quick $10 million and run... or maybe I wouldn't. Now that I think about it $10 million might be too low. Hmm... I have to think about this.

What does this say about me? Am I irrational? Or do I just REALLY want a large sum of money?


The basis of our governments being the opinion of the people, the very first object should be to keep that right; and were it left to me to decide whether we should have a government without newspapers, or newspapers without a government, I should not hesitate a moment to prefer the latter. But I should mean that every man should receive those papers and be capable of reading them.
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Old 05-14-2008, 09:15 PM   #16 (permalink)
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Quote:
Originally Posted by George W. Bush View Post
So I wonder if I can reason this out... I've often asked myself: "What is greatest risk in % terms that I would take for $1 billion if the losing scenario was an instant painless death?"

And I honestly think I'd put it at between 30-50%, yet in your scenario I'd take the quick $10 million and run... or maybe I wouldn't. Now that I think about it $10 million might be too low. Hmm... I have to think about this.

What does this say about me? Am I irrational? Or do I just REALLY want a large sum of money?

Not really, because if you count anything above say 30 million as all the same, which it basically is, the expected value falls to 15 million or so, through in some risk aversion and it seems alot different than the pure math.
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Old 05-14-2008, 10:11 PM   #17 (permalink)
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Dude you'd take a 30-50% risk of dying wherein you win $1B if you don't? That's fucking sick. I'm not even sure I'd do it for 2%.
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Old 05-14-2008, 11:18 PM   #18 (permalink)
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I said 1 million dollars.

You guys are greedy bastards.
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Old 05-14-2008, 11:25 PM   #19 (permalink)
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Not really, because if you count anything above say 30 million as all the same, which it basically is, the expected value falls to 15 million or so, through in some risk aversion and it seems alot different than the pure math.


I 2nd that!

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Old 05-15-2008, 12:36 AM   #20 (permalink)
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I said 1 million dollars.

You guys are greedy bastards.
one million dollars will get you 10 years of comfortableness, if you know what you're doing. most people who fall into that kind of money (myself included) would use up a mil a lot quicker than that, if they had it.

theres a difference in what our spending habits would be now, with not a lot of money to spend, than if we had a shit ton to spend. A mil would go pretty fast i'm sure.
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Old 05-15-2008, 03:56 AM   #21 (permalink)
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Quote:
Originally Posted by Mr. Blonde View Post
one million dollars will get you 10 years of comfortableness, if you know what you're doing. most people who fall into that kind of money (myself included) would use up a mil a lot quicker than that, if they had it.

theres a difference in what our spending habits would be now, with not a lot of money to spend, than if we had a shit ton to spend. A mil would go pretty fast i'm sure.
Very Very true.

I have always said that if I were to come into a sum of money like a Mil, I'd just invest it and use the interest as disposible income.
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Old 05-15-2008, 05:47 AM   #22 (permalink)
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If the death was instant and painless I'd take a coin flip, heads death, tails billion dollars.

#YOLO
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Old 05-15-2008, 06:34 AM   #23 (permalink)
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100 bucks!!!!

Putting the sensual in non-consensual.
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Old 05-15-2008, 03:57 PM   #24 (permalink)
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Quote:
Originally Posted by Ugly Bastard View Post
Dude you'd take a 30-50% risk of dying wherein you win $1B if you don't? That's fucking sick. I'm not even sure I'd do it for 2%.
Holy shit, I didn't catch the death part, I assumed the sentance ended "or winning no money at all".
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Old 05-15-2008, 05:09 PM   #25 (permalink)
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X would have to be at least 500 million. If it's either 1 billion or nothing, I'd just take the 500 mill and walk away.

Wow, I guess I am greedy after going back and reading everyone else's answers. I just think that if I have a chance to walk away with a billion that I would rather have half and not win or lose.

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