Sunday, September 12, 2004

Making the Best Choice

Making the Best Choice is what it's all about in life.

Suppose you want to make an investment today. Each day your stockbroker gives you about 20 opportunities to invest.
But you want to make only one investment this day and it should be the best one.
How can you be sure to pick the right one?

You have only limited time (say about 10 minutes) for each investment to decide; after that, you’ll have to wait for the next offer. So after you go to the next investment offer, you won't be able to come back on the first one.
This kind of problems are known as

"The Sultan's Dowry Problem"
"The Secretary Problem".

The solution in these cases is very simple.

Rule of Thumb

Let go the first 33% of the total number of possibilities


choose the first one that has a better score than any of the ones you've seen thus far !

By doing so you have about 40% change you picked the best choice.

Of course this is a rough approximation. Are you interested in the exact probabilities and how it really works?
Go to :

Making Decisions

The best choice out of 'n' unknown opportunities

Or of you like these kind of problems.

Anyway : Good choice !

No comments: