Only if the relevant utility function is sublinear. If the relevant utility function is linear or superlinear, you aren’t risk averse, so you don’t care about a single point of failure. You care about p(failure)x0 + p(success)xU(success).
E.g. assuming altruism is all you care about, if you could pay $10,000 for a bet which would cure all the problems in Africa with probability 0.01%, and do nothing with probability 99.99%, then you should take that bet.
Only if the relevant utility function is sublinear. If the relevant utility function is linear or superlinear, you aren’t risk averse, so you don’t care about a single point of failure. You care about p(failure)x0 + p(success)xU(success).
E.g. assuming altruism is all you care about, if you could pay $10,000 for a bet which would cure all the problems in Africa with probability 0.01%, and do nothing with probability 99.99%, then you should take that bet.