Short run proportions are often quite different from


Short run proportions are often quite different from long-run probabilities.

1. In your own words, explain why we would expect proportions to fluctuate in the short run, but why long-run probabilities are more predictable?

2. What is the expected long-run probability of heads if you flip a coin many time? Why?

3. Flip a coin 10 times in a row. What proportions is heads? Do this 5 times.

4. Do the proportions in part c match the expected long-run probability in b? Why or why not

5. Imagine that a friend flipped a coin 10 times, got 9 out of 10 heads, and complained that the coin was biased. How would you explain to your friend the difference between short term and long term probability?

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Microeconomics: Short run proportions are often quite different from
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