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Should you choose the second box, or should you stick to your first choice to maximize the expected amount of money?

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Someone shows you two boxes and he tells you that one of these boxes contains two times as much as the other one, but he does not tell you which one this is. He lets you choose one of these boxes, and opens it. It turns out to be filled with $10. Now he gives you the opportunity to choose the other box instead of the current one (and skip the $10 of the first box), because the second box could contain twice as much (i.e. $20).

Should you choose the second box, or should you stick to your first choice to maximize the expected amount of money?

posted Jun 30, 2014 by Aarati Mahajan

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