Originally posted by richjohnson
Sorry, that was sloppy. X represents the amount of money in the envelope you choose first.
My question relates to the case where there is no maximum amount of money, and no funny money distribution algorithms:
Does it matter if y ...[text shortened]... agering $500,000 if the 1st choice envelope contained $1,000,000).
EDIT: Lest I confuse you, I should point out that in your first post here, your first sentence is correct, but your second sentence is not. It is your second sentence that I am addressing here.
-----------------------------------
My question was somewhat rhetorical in nature.
X is not well-defined, even after you say that X represents the amount of money in the envelope you choose first, and even after you know the value of the money in that envelope.
Allow me to be more precise. You'd like to use X in this way, to claim two things:
1. X is the amount of money I see when I open an envelope.
2. The other envelope contains either 2X or .5X, with equal likelihood.
The problem is that in (2), X necessarily represents something other than what you claim it represents in (1). This is not obvious or intuitive to everybody, but nonetheless, it is so.
Let us be more concrete to illustrate that this is true. Suppose you find 20 in the First envelope. Is it really true that the Other envelope is just as likely to contain 40 as 10, and that by switching you expect to end up with 25 on average? Well, let us consider two cases to determine this.
Case 1: Suppose that the Other envelope contains 10. By your reasoning, if the Other envelope had been opened first, you would then say that the First envelope is just as likely to contain 5 as 20. Therefore, again by your reasoning, opening the Other envelope first, you expect the First envelope to contain (20+5)/2 = 12.5, and thus you would switch to choosing the First envelope, since 12.5 > 10.
Case 2: Suppose that the Other envelope contains 40. By your reasoning, if the Other envelope had been opened first, you would then say that the First envelope is just as likely to contain 20 as 80. Therefore, again by your reasoning, opening the Other envelope first, you expect the First envelope to contain (40+10)/2 = 25, and thus you would switch to choosing the First envelope, since 25 > 20.
In both cases, the very logic that would lead you to switch in the first place would be employed to show that it is more profitable to switch back. Thus, we have a contradiction, so your logic that leads you to switch --- (2X + .5X)/2 > X --- is necessarily flawed.
So, that is a proof that X can't have a consistent meaning across (1) and (2) above.
I can't easily explain why this is so, because it is so obvious that it is. It reminds me of the missing dollar problem, if you're familiar with that. There, if somebody believes that there really is a missing dollar, it's incredibly difficult to put into words why there isn't, except to say that there is simply no reason to arrive at that assertion.
I'll think it over some more to see if I can provide a better explanation. But just as addition, subtraction, and variables are simply abused in the missing dollar problem, so do many people abuse random variables and expected value in this problem, which we have seen.
Dr. S