# hypothetical life/career decision.



## cape (Jun 18, 2010)

My friend sent me this question:

You are making 55k a year, no raise potential. At the end of year, boss offers you a scenario. There is a wheel with 100 ping pong balls in it. 99 of the balls have your name inside it. There is 1 out of the 100 ping pong balls that is blank without your name on it. If he/she chooses any of the 99 balls with your name on it, u win 20k bonus, so 75k total that year . But if the blank ball is chosen you lose your current job and make 35k for life at another job. Would you take the spin or pass? Please specify if possible.

All figures are assuming take home (after taxes)


----------



## solarz (Aug 31, 2010)

This is one of those risk-aversion scenarios used in psychology studies. However, the premise is not entirely realistic: why would you be forced into a 35k job for the rest of your life?

If we stick to the premise, I would not take the spin for the following reason: having an extra 20k for one year does not make a big difference in my living standards, while being locked into a 35k salary for life would make a big difference.


----------



## solarz (Aug 31, 2010)

It also depends on how close you are to retirement.


----------



## Mykuhl (Apr 8, 2013)

I would for sure take the chance. Odds would be very much in my favour...99 to 1, I like those odds!

With those odds why not?


----------

