Dourgrim wrote:So if, in the case of the envelopes, it is always advantageous to switch between the two envelopes (and an infinite number of times, at that), doesn't that also translate to it being advantageous to not bother switching at all?
This is essentially the paradox before us. Our expected value calculation shows that switching is always right, yet common sense dictates that this strategy is absurd.
No, that's not what I'm saying. I'm saying you should always take the envelope that has the unknown quantity.
Yes, and that is true for the case where you opened the envelope and found $50. But I'm saying the next interesting generalization is that the "always switch" result still holds if you didn't open the envelope at all. You're simply handed the envelope with some unknown amount of money in it, you're not allowed to open it, but you
are
allowed to switch envelopes if you want. Our calculation above shows that it's always right to switch, but after you've switched, the same argument holds again!
But yes, the proverbial nail has been hit on the head:
[quote="CurtainDog"I think the problem is that n is unbounded, therefore your expected payoff before looking at either envelope is infinite.[/quote]
We have that the expected value of staying is X, and the expected value of switching is 1.5X. This is only a contradiction of common sense if 1.5X>X. However, X is infinite. To convince yourself of this, if it weren't infinite, what would it be? A million dollars? There sure are a lot more numbers bigger than a million than smaller than million, so there's no way that could be right. Same argument for a billion, a trillion, etc.
So the expected value of staying or switching is infinite. CurtainDog is also right that as soon as we restrict the problem to a finite set of possible values the paradox disappears.
Hope that was enjoyable...I'll let you know if I find more.
Cam