On Wednesday we welcome Dr Edwin Meyer, from Baldwin Wallace University in Ohio, USA, who will be delivering the below seminar. All interested are welcome to attend.
Date: Wednesday 22nd August 2012
Venue: Ingkarni Wardli Building, B17 Teaching Suite 1
Title: The solution to the Two-Envelope Paradox
Abstract: The Two Envelope Paradox – There are two sealed envelopes – one of which contains twice as much money as the other. Alice chooses one randomly and then is asked whether she would like to exchange her envelope for the one she did not choose. Alice reasons thusly, “Call the amount in my envelope X. The other envelope contains either X/2 or 2X with a 50% probability. The average in the other envelope is therefore 1.25 X, so I should switch. But, of course, the envelopes are symmetric so there can be no preferred envelope. Further, once Alice switches she can reason the same way with the other envelope. That is, it appears that the other envelope always contains an average of 1.25 the amount in your envelope.
Many “solutions” to the famous Two-Envelope Paradox have been published. However, the matter is by no means settled. Every year new “solutions” to the paradox get published and the matter is still debated heavily by philosophers, economists, mathematicians and even physicists.