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Topic: virus: thought experiment #35 (Read 1591 times) |
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David Lucifer
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virus: thought experiment #35
« on: 2003-11-17 12:21:47 » |
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An interesting thought experiment courtesy of Raven's blog http://blog.ravenblack.net/:
If a nondescript person on the street gave you a blank cheque (signed and such, obviously)
and permission to use it, but didn't tell you how much is in the account, how much would
you make out the cheque for, and why? [You can assume the person proves their identity to
your satisfaction.]
If the person says they'll tell you how much was in the account once you've got the money
(or once the cheque has bounced), how does that affect your answer, if at all?
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Kid-A
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Re:virus: thought experiment #35
« Reply #1 on: 2003-11-18 17:28:07 » |
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I would take this character as being a strange fellow walking around with blank cheques in hand, and so i would therefor come to the conclusion that he/she is a student.
Going by the rational that all students are broke/in debt, i would put down the handsome sum of £0.00 just to see if the bank will accept it.
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Blunderov
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"We think in generalities, we live in details"
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RE: virus: thought experiment #35
« Reply #2 on: 2003-11-22 12:12:25 » |
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David McFadzean
> Sent: 17 November 2003 1922
> An interesting thought experiment courtesy of Raven's blog
> http://blog.ravenblack.net/:
>
> If a nondescript person on the street gave you a blank cheque (signed
and
> such, obviously)
> and permission to use it, but didn't tell you how much is in the
account,
> how much would
> you make out the cheque for, and why? [You can assume the person
proves
> their identity to
> your satisfaction.]
>
> If the person says they'll tell you how much was in the account once
> you've got the money
> (or once the cheque has bounced), how does that affect your answer, if
at
> all?
[Blunderov]
Haven't been to the blog yet but the question has been much on my mind -
a nice puzzle!
It seems to me that there would be little point in filling in the cheque
for any amount that would not change your life in some significant way.
The worst that can happen is that you walk away from the encounter with
your life exactly the same as it was before.
There is no risk in citing an amount that would change your life.
There is no point in choosing an amount that will make little or no
difference to your life because this outcome is already probable anyway.
The more easily your life can be changed for the better, the more likely
it is that the cheque will fulfill this outcome.
For instance if you are working for the dreaded minimum wage and your
car is broken with no prospect of money becoming available for its
repair, the sensible choice is to fill out the cheque for the amount of
the repair.
Or, if you are doing OK but the taxman unexpectedly demands ten thousand
dollars from you, then fill out the cheque for that amount.
But if you are living in Mr Mickawber heaven, the sensible choice would
be to fill it out for a million dollars or whatever arbitrary amount you
decide would gear up your financial position by one level.
Best Regards
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David Lucifer
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Re:virus: thought experiment #35
« Reply #3 on: 2003-11-24 19:08:47 » |
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I would estimate a probability distribution for the balance in the account given whatever information I have available (like how this person is dressed, how they speak, where we are, etc). Then I would find the amount that maximizes the expected return (amount * probability). Finding out the balance after I wrote the check would not change my answer.
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rhinoceros
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My point is ...
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Re:virus: thought experiment #35
« Reply #4 on: 2003-11-26 13:25:34 » |
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[Lucifer]
I would estimate a probability distribution for the balance in the account given whatever information I have available (like how this person is dressed, how they speak, where we are, etc). Then I would find the amount that maximizes the expected return (amount * probability). Finding out the balance after I wrote the check would not change my answer.
[rhinoceros]
This is a good approach if you can really translate these things into a numerical probability distribution. What does the last sentence mean? Wouldn't the exact sum be the best answer if you knew it?
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David Lucifer
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Re: Re:virus: thought experiment #35
« Reply #5 on: 2003-11-26 20:27:59 » |
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rhinoceros wrote:
> [Lucifer]
> I would estimate a probability distribution for the balance in the
> account given whatever information I have available (like how this
> person is dressed, how they speak, where we are, etc). Then I would
> find the amount that maximizes the expected return (amount *
> probability). Finding out the balance after I wrote the check would
> not change my answer.
>
>
> [rhinoceros]
> This is a good approach if you can really translate these things into
> a numerical probability distribution. What does the last sentence
> mean? Wouldn't the exact sum be the best answer if you knew it?
[Lucifer]
The more time and information I have to make a good estimate of the
probability curve, the better my answer will be (in terms of decision,
not necessarily in terms of outcome, the distinction is subtle but
all important for decision theory). I made a couple clarifications
for Raven after I posted this. First, the estimated curve represents
the probability that any given value is less than the balance of the
bank account. This means the curve is monotonically decreasing and
a bit easier to estimate. The second point Raven brought up is that
I should take into account the utility of the money, rather than the
face value of the money. For example 1 billion dollars is not (necessarily)
worth 1000 times as much as 1 million dollars to me at this time.
Yes, if I knew the exact sum in advance that would make it easy but
the question was different: would knowing that I would find out the
exact sum after I choose change my choice? I wouldn't want to know
(it would always be bad news unless I lucked out and guessed the exact
amount) but it wouldn't change my answer in any case.
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