Re:Insurance is like gambling, don't overdo it
by OJFord on Sunday June 20, 2021 @07:01AM
(#27568912)
Payouts are also non-linear though, with enormous discontinuities.
Your millionth dollar might have less marginal utility, but you were never going to win 10^6 -1 dollars anyway. So really to consider marginal utility you need 'margins' as wide as the payouts. (Really stretching/breaking the meaning of marginal, but hopefully you see what I mean.)
Your millionth dollar might have less marginal utility, but you were never going to win 10^6 -1 dollars anyway. So really to consider marginal utility you need 'margins' as wide as the payouts. (Really stretching/breaking the meaning of marginal, but hopefully you see what I mean.)