For John, BLUF: I guess risk is subjective. Nothing to see here; just move along.
I am apparently missing something with regard to this test of one's risk taking. In the situation you are given both $100 and a coin. You are now $100 richer. Put another way, a minute ago you had what you had and now, out of nowhere someone has given you $100. You are now in a game, playing with someone else's money. You are asking to wager that [free] $100 on the flip of a coin. It seems to me that unless you need that extra $100 for medicine for your ailing mother or for baby's new shoes, you take the shot.
Am I wrong here?
Hat tip to the InstaPundit.
Regards — Cliff
Everything depends on the marginal utility of the gain vs the loss. The choices falling out of your "ailing mother" suggestion depend entirely on how much the medicine might cost.
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