Newsworthy Math
A Discussion about Mathematics in Society
everyday math
Cruel but Fair
It’s unfair to make fun of people for not understanding the math they were “taught” in school. But this is pretty damn priceless. It’s hard to see how even the most perfect mathematical education could have got round this level of misunderstanding.
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Synthetic Collateralized Alchemy
What Was Wrought CDO’s (collateralized debt obligations), see this for my introduction to these, depend on underpriced low grade debt. If I can get a 20% discount on debt that has a 10% chance of defaulting, then I should just buy this all day. All I need is enough risky debt (and some confidence in [...]
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The Unexpected Cost of Lotteries
By definition, the expected value of a one in five chance of winning $10 dollars is worth $2 ($10/5). But to human beings, with our finite life spans and our asymmetric financial needs, a one in a million chance of $1,000,000 is not necessarily worth $1, it might be worth more. Lottery tickets cost far, far more [...]
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Insurance and Mortality Curves
The life insurance business is very good at calculating the probability of you dying within the next year. It’s one of these things that we’ve being doing so long that we’re pretty good at it. Given your circumstances, they can produce a curve showing the probability of you dying at any given year from then [...]
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"Show Your Working"
One of the many things that makes math difficult to learn is the seemingly universal reluctance to be comfortable with incomplete thoughts. In math terms this translates to “write down you’re intermediate results”. Kids hate to do this. If you ask them to do a multi-step problem it is an enormous struggle to get them [...]
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Simulation and Modeling
Simulation is a wonderful thing. It’s one of the foundations of mathematics. Scale models are a good example. If you want to see what the new building will look like make a model. It isn’t going to tell you everything, the architectural models of housing projects usually look wonderful, but it’s a great example of [...]
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What’s the Biggest Number in the World?
They go on forever, of course, but one of the entertaining things about mathematics is its habit of defining and naming fabulously large numbers. This can also be useful. The Romans could barely write down the number of citizens in their empire. These days Roman numerals couldn’t write down the number of people on the [...]
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