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owencb comments on How to treat problems of unknown difficulty - Less Wrong Discussion
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The end of your example gets hard to follow. In particular I don't know what this means:
On the other hand it sounds like you're reaching a qualitatively correct solution.
pP is the negative logarithm of P, the probability of the 'jackpot payoff'.
If money were of linear value, I would be ambivalent about investing $10k in a startup that had a .01 chance of making a million dollars; for P=.01, pP=2