Press the button or not?

I've been watching reruns of Million Dollar Password with Regis Philbin.
If you win $25,000, you're going home with that guaranteed.

The next amount is $50,000 and, if you win the round, you're going home with that amount.
People are then given the option of risking that $50,000 by going for the next higher amount where the passwords are harder and if you miss, you're bumped back down to $25,000.

I can't believe how many contestants go for more and lose $25,000.
 
It's an interesting thought experiment dealing with behavioral economics.
Knowing myself, I would have to say I would take the 200k because I don't like sleepless nights of regret if I were to lose, knowing I could have banked the sizeable free money. I guess a base hit is better than swinging for the fences with a 50% chance of striking out and losing the game.
On the other hand, if the amounts were considerably less, but with the same percentage: Let's say 20k sure money or 50% chance of $500k, then I think I would go for it, since I am playing with the house's money and $20k wouldn't change my life that much anyway.
When it’s a windfall, the risk feels like play.

That being said, if I were betting with my own money of $20k with a 50% chance at $500k, I wouldn't do it. When it’s my own hard-earned cash? That’s sacred ground. To me, the pain of losing something you already have often outweighs the joy of gaining something new, but playing with a windfall that isn't too significant somehow changes things. In that case, I would feel like I don't have any skin in the game, so what the hell.
 
Interesting question. My thoughts are if youre living on a shoestring I would take the 200K.
Bird in the hand. That money could be life changing for some especially if they are older and in poor health.
Now if you were young and healthy and at the beginning of your career I might say push the button.

For me it would all boil down to how much did I need money. I lead a simple life. Dont need much.
I dont spend what I do have. And theres nobody to leave it to when I go.
In the past I would have taken the 200K. Right now I would push the button.

I view this as I do all gambling. Dont bet what you cant afford to lose. :D
 
At my age, it's all about short term, and I don't know if I have enough time to spend $200,000. I don't even feel like spending 200K. So I'll go for the button. Of course, I know I won't spend that either. I'd just get a kick out of denying Merchandisers of my money.

I knew a millionaire who put in his will that he wanted to be buried with his millions of dollars in cash. He instructed his wife to carry that out. I later asked his wife if she actually buried him with all that cash and how hard it was for her to do that. She replied, "No problem; It was easy. I just wrote out a check and put than in the coffin."
 

You must log in or register to reply here.

Back
Top