Are you comfortable with dubiousness ? Are you willing to take money from those who are n’t well-heeled with it ? Then I have just the rig game for you ! Make money from people ’s incertitude with the Ambiguity Effect .
Here ’s a quick secret plan . I have a shock full of ninety marbles . There are thirty red marbles for sure , but there ’s a mix of smutty and white marble , and I ca n’t be indisputable how many of each is in there . you may choose between one of two game . The first game awards you a hundred dollars if you peck a red marble . The 2nd game forces you to find fault either black or white as the “ winning color , ” and honor you a hundred dollars if you pick the marble of your choice .
Most hoi polloi will piece the red marble game . jazz their exact odds of winning quilt them . They even pick the red game if it ’s explain to them that the game have an adequate probability of pull ahead them the hundred bucks . To see why the black and blank secret plan winnings , have ’s change the game slightly . Instead of picking which marble color deliver the goods before you draw , you draw and then flip a coin to see which color acquire . So if you ’ve just drawn a calamitous marble , the odds of gain with that marble are fifty percent – the likeliness of either side of a coin flip . And if you ’ve just drawn a white marble , the betting odds of winning with that marble are fifty pct . Considering the overall odds of draw either contraband or white are two - thirds , fifty percent of two thirds is one third – or precisely the betting odds of gain ground with a red marble .
Why is this important ? Because of their dislike of uncertainty , people will pay up to move from an uncertain game to a more certain one . So you may either charge up slightly more money for the cherry marble biz , or exploit the crew with a partner . citizenry get assigned on biz or the other , and your partner , with the more - worthy crimson marble game will trade their ticket for a hard currency incentive to masses who do n’t like their betting odds ( even though they should ) .
mental image : Muffet
ViaAmbiguous Probabilities and the Paradoxes of Expected Utility .
cognitive biasesPsychologyScience
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