EDIT: NVM. This is just proof I didn’t get enough neonatal iodine.
For Section 2 on transaction costs you write the calculation for probability of winning is:
100 / ( ( ( 100 / 0.40 ) * 0.9 ) + 10 ) Where does the extra +10 come from?
100 / ( ( ( 100 / 0.40 ) * 0.9 ) + 10 )
EDIT: It’s so that you’re not paying taxes on the amount of the original wager.
maximum_%_bet_on_P = bet_amount / (conditional_winnings—fees )
= bet_amount / (conditional_winnings(1-fee%) + bet_amount*fee%))
The +10 is because the 10% fee does not apply to your original $100, only to profits. So if you would have $250 without the fee, rather than 250 * 0.9 = $225, you end up with $235.
EDIT: NVM. This is just proof I didn’t get enough neonatal iodine.
For Section 2 on transaction costs you write the calculation for probability of winning is:
100 / ( ( ( 100 / 0.40 ) * 0.9 ) + 10 )Where does the extra +10 come from?
EDIT: It’s so that you’re not paying taxes on the amount of the original wager.
maximum_%_bet_on_P = bet_amount / (conditional_winnings—fees )
= bet_amount / (conditional_winnings(1-fee%) + bet_amount*fee%))
The +10 is because the 10% fee does not apply to your original $100, only to profits. So if you would have $250 without the fee, rather than 250 * 0.9 = $225, you end up with $235.