Rest of the problems are in the attached file. I also attached book.

1.(the Exchange Paradox) You’re playing the following game against an opponent, with a referee also taking part. The referee has two envelopes (numbered 1 and 2 for the sake of this problem, but when the game is played the envelopes have no markings on them), and (without you or your opponent seeing what she does) she puts $m in envelope 1 and $2 m in envelope 2 for some m > 0 (treat m as continuous in this problem even though in practice it would have to be rounded to the nearest dollar or penny). You and your opponent each get one of the envelopes at random. You open your envelope secretly and find $x (your opponent also looks secretly in his envelope), and the referee then asks you if you want to trade envelopes with your opponent. You reason that if you trade, you will get either $ x 2 or $2 x, each with probability 1 2 . This makes the expected value of the amount of money you’ll get if you trade equal to 1 2 $x 2 + 1 2 ($2 x) = $5x 4 , which is greater than the $x you currently have, so you o↵er to trade. The paradox is that your opponent is capable of making exactly the same calculation. How can the trade be advantageous for both of you?

Looking for solution of this Assignment?


We deliver quality original papers

Our experts write quality original papers using academic databases.  

Free revisions

We offer our clients multiple free revisions just to ensure you get what you want.

Discounted prices

All our prices are discounted which makes it affordable to you. Use code FIRST15 to get your discount

100% originality

We deliver papers that are written from scratch to deliver 100% originality. Our papers are free from plagiarism and NO similarity

On-time delivery

We will deliver your paper on time even on short notice or  short deadline, overnight essay or even an urgent essay