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This was framed as a problem on 538's The Riddler column a few years ago: https://fivethirtyeight.com/features/should-you-pay-250-to-p...

One solver in particular submitted several elegant solutions: http://math.uchicago.edu/~timblack/blog/addtoone.html



The compound interest explanation was particularly intriguing. In part because I haven't fully grokked the discrete-vs-continuous interest difference yet (also haven't tried very hard -- just remember being a bit surprised by some things mentioned in Paul Wilmott Introduces Quantitative Finance). I liked the intuition of simply "owning very many such bills" reducing to the expectation.




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