KL

Karl Lietzan

9 karmaJoined Oct 2022

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1

The St. Petersburg paradox is not a paradox.  The expected value of the wager varies as the square root of the sample size. Because we sum functions over infinity, we get infinite ev, but this is irrelevant to someone without infinite time.  So the answer to the question, how much do we pay for the opportunity to wager, we say, something less than the square root of the number of times we get to run it.  If you write a script to run this experiment, you can see how this is so.