Which would you choose? And Why

Barry · Oct 31, 2012

Red Button? Or Green Button?

santa · Oct 31, 2012

Nice Q.
I had a dilemma for a second, then it was easy.

The $1million. Now if I had a good wage coming in and/or great looking business or a few million already I might be inclined to take a punt on th 50/50.

But right now, $1m would be a life changing sum. Having that guaranteed, well I couldn't turn that down.
Being more specific I could use it to pay and see any doctor in the world related to my medical condition and get all the physio and care support I'd need. But even if I was average joe without this issue I'd still pick it.

It would also give a chunk to play with for entreprenuerial adventures while comfortably giving one some stability.
I WOULDNT use the money to upgrade material wealth in the main though. But as a vehicle to having future fastlane success on a more stable front

(SideNote; Hopefully it wouldn't happen but the danger with $100m for some-i.e. slowlane/sidewalk mentalities- is they would stop working on the skills that others with a $100m got through good money mechanics and business acumen)

MJ DeMarco · Oct 31, 2012

For me, no contest: 50% of 100M.

$1M would not impact or change my life at all.

$100M?

Probably a tiny bit - moreso, the people around me.

Great question. Speed+.

Barry · Oct 31, 2012

Yeah for the already wealthy I think it would be a no brainer to take the risk for the 100Million but for the average joe when your eating ramen noodles and mac and cheese and someone hands you 1mil its also a no brainer Hahaa

1PercentStreet · Oct 31, 2012

The 100mm.

Go big or go home.

The-J · Oct 31, 2012

Let's think about this for a sec:

The expected value of the first one is $1 million, the expected value of the second is $50 million, right?

However, in my current situation, the $1 million would be a life-saver. School would be paid, my business would have a nice sum in the bank, and I'd be collecting interest on the remaining couple hundred thousand. I wouldn't buy a house: that would be financially unsound, and I still can't drive a stick so getting an exotic is out. However, with the $1 million, not much would change: I'd still be in school, I'd still be building my business and I'd still be chillin here in this tiny room.

The $100 million would probably kill my motivation. I already have an idea of what my number is and what I want to do with that money. Taking the $100 million would be great, earning 5% interest on that is $5 million annually less taxes, which is still hundreds of thousands a month of income, most of which I don't need since I live off of $900/month anyway. And if I wanted to, I'd be able to move into my dream home no sweat, drive whatever car I want, all that.

Logically, the $100 million button is a better bet. Emotionally, I'm not sure if I'm ready to handle a massive change so quickly.

So I just flipped a coin on the $100 million bet, got tails, which means I would have walked away with nothing in that very instant (okay no it doesn't I just wanted to try it lol)

socaldude · Oct 31, 2012

the 100 mil for sure. for a coin flip? hell yeah. can you imagine the impact of 100mil on your life and others?

to reduce 100 percent chance by 50 percent for 100 times the money is in your favor

Jake · Oct 31, 2012

socaldude said:
the 100 mil for sure. for a coin flip? hell yeah. can you imagine the impact of 100mil on your life and others?

to reduce 100 percent chance by 50 percent for 100 times the money is in your favor

If we're flipping coins and I can verify there is in fact a heads and a tails and the money is stacked in front of me I would probably go for it. If it's a button..I'd take the guarantee and call it a day.

Lights · Oct 31, 2012

the green button, I like green.

it's just 50% chance, if I lose I just lost 1 million dollars. If I win I earn 100 million.

healthstatus · Oct 31, 2012

both, since no effort is required other than button pushing.

Rawr · Oct 31, 2012

I am afraid that having 50 mil given to me at this point would do anything positive but ruin my life.

wade1mil · Oct 31, 2012

Assuming it's not rigged, green.

Red gives you a 100% of getting $1m, and 0% chance of getting $0. Average result is $1m.
Green gives you a 50% of getting $100m, and a 50% chance of getting $0. Average result is $50m.

By picking green, you statistically earn $49m more than red.

MJ DeMarco · Oct 31, 2012

wade1mil said:
By picking green, you statistically earn $49m more than red.

I was wondering how long it would take someone to have the right answer, based upon mathematics and expected value. If Snowbank was here, he would have dropped it in a heartbeat.

EV on Red is $1M
EV on Green is $50M

The whole point of the Fastlane is to be working on high EV businesses. "I made $510 last week selling this Blue Acai drink from this great affiliate program!" is not high EV. Creating a startup based upon the 5 Commandments = High EV.

So let me ask you...

Which button represents your current business?

Low EV Red? Or High EV green?

theBiz · Oct 31, 2012

If you have less than 100k in the bank just pick the 1 mil lol. If you have more than 4 mil in assets/in your bank, go for the 100 mil

Pinnacle · Oct 31, 2012

Rawr said:
I am afraid that having 50 mil given to me at this point would do anything positive but ruin my life.

You don't trust yourself enough to intelligently invest it?

wade1mil · Oct 31, 2012

MJ DeMarco said:
If Snowbank was here, he would have dropped it in a heartbeat.

Haha, I thought the same thing. I looked for his response before I put mine

Pinnacle · Oct 31, 2012

I want the pride and reward of knowing I've made $1 million on my own. I'd take the 50% chance of $100 million and begin developing systems for the careful investment of the money.

theag · Oct 31, 2012

MJ DeMarco said:
I was wondering how long it would take someone to have the right answer, based upon mathematics and expected value. If Snowbank was here, he would have dropped it in a heartbeat.

EV on Red is $1M
EV on Green is $50M

The whole point of the Fastlane is to be working on high EV businesses. "I made $510 last week selling this Blue Acai drink from this great affiliate program!" is not high EV. Creating a startup based upon the 5 Commandments = High EV.

So let me ask you...

Which button represents your current business?

Low EV Red? Or High EV green?

I must disagree, because to be honest, what you say is wrong/doesn't apply here. This is about the single push of a button, you can't compare this to a low/high EV in business.

EV is a statistical concept:

Wikipedia said:
The expected value may be intuitively understood by the law of large numbers: the expected value, when it exists, is almost surely the limit of the sample mean as sample size grows to infinity. More informally, it can be interpreted as the long-run average of the results of many independent repetitions of an experiment (e.g. a dice roll).

Expected value - Wikipedia, the free encyclopedia

The important word here is long-run. This is why snowbank applies the concept of EV to both poker and business. In poker you play a lot of hands and have a large sample size and therefore you play in a way to maximize your long-term EV. In business you spent a lot of time and want the best possible EV for the time (and money) you invest into a business.

But this is about the SINGLE push of a button. The concept of EV doesn't apply here. So, for me, I'd choose the red $1m button without even thinking about it and go from there.

Of course you are right when applying EV to a business. But thats because a business is a long-term PROCESS and not just an EVENT (push of a button).

Steve37 · Oct 31, 2012

Not to steal an answer and justification already used, but green without question.

$1mm would have no impact on my life while $100mm would have a significant impact.

If I had to answer this question back in college like many of the other posters I'm not sure which way I would have chosen. $1mm is a pretty big way to start off young in life and if invested wisely ( and not pissed away on cars / booze / etc ) it could allow you to accumulate wealth somewhat rapidly. All that said I probably would have gambled for green back in my early 20's and then pissed away some of the winnings on cars / booze / women / etc.

wade1mil · Oct 31, 2012

theag said:
The important word here is long-run.

There is still an expected value for each button, $1M and $50M respectively. EV isn't meant only for decisions that you make over and over again. Sometimes in poker you use EV to determine whether to call for all your chips when you're one away from the money. That's a single decision that you apply EV to.

This reminds me of the scene in 21 where the teacher (Kevin Spacey) and the main character (goes by Ben I think) are going through the fake game show where he's given the chance to pick Door #1, Door #2 or Door #3. He chooses Door #2 and then changes the door when given the opportunity because his odds increased just by being allowed to change his answer. That was one choice as well, and the "long term" statistics he used were to make a "single decision" that he would only be allowed to make once. Same idea.

MJ DeMarco · Oct 31, 2012

theag said:
This is about the single push

Yes, but when the green button has a 50% probability ... this turns the "event" (pushing a button) to a "process" simply by virtue that a single push has 2 different outcomes -- either $100M or $0.

Vigilante · Oct 31, 2012

There isn't anyone that finds their way to MJ's book that couldn't figure out how to take action and reach $1m. The red button is obtainable by almost everyone who will reply to this thread.

Green button.

LamboMP · Oct 31, 2012

wade1mil said:
Assuming it's not rigged, green.

Red gives you a 100% of getting $1m, and 0% chance of getting $0. Average result is $1m.
Green gives you a 50% of getting $100m, and a 50% chance of getting $0. Average result is $50m.

By picking green, you statistically earn $49m more than red.

Awesome. I was going to say this is a probability theory question.

1PercentStreet · Oct 31, 2012

I knew there was a deeper value to this.

By the way, 1mm isn't difficult to achieve if you follow the outlines MJ has provided for your business. Anyone can do it with perseverance. Few can reach beyond that point though, at least from what I've seen.

1MM wouldn't change my life much except maybe being more financially secure(for the time being at least). 100MM would change my life. So if I take a chance at 100mm rather then the 1mm I wouldn't be missing that 1mm. It was never gained so it was never lost. In my opinion of course

Kak · Oct 31, 2012

I think I'd take the 1 million because I know I am going to make more in my life and this could really help. I really had to think about this. I think if these buttons were really sitting right in front of me I would just roll the dice.

oddball · Oct 31, 2012

I'd put a stick across the two and then push the green one, I win.

wade1mil · Oct 31, 2012

1PercentStreet said:
By the way, 1mm isn't difficult to achieve if you follow the outlines MJ has provided for your business. Anyone can do it with perseverance.

You seem to be confident whenever you post something, but this is total BS. It is difficult to achieve, and hardly anyone does it. That is why more than 98% of households aren't worth $1M.

Lights · Oct 31, 2012

Okay,

let's gang up, 4 of us or so, will make a legal binding contract.... no matter what happens we'll divide up the money between us even if we win or lose.

that way, it's kind of a guarantee we'll come out with 25 million or 50 million, or 75 million.

it's either that or you'll take the guarantee 1 million or the coin flip of 100 million. I don't know about you but 25 or 50 million will have me at financial freedom for the rest of my life....

going to let greed take over, and possibly end up with nothing?

Rickson9 · Oct 31, 2012

Expected value vs absolute value? Is this a stats quiz?

Kak · Oct 31, 2012

Many people would pay a million dollars to push button 2....

100x multiplier on a color in roulette I would be playing all night.

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