Corpus ID: 211259160

A New Pricing Theory That Solves the St. Petersburg Paradox

  title={A New Pricing Theory That Solves the St. Petersburg Paradox},
  author={Da-hang Li},
  journal={arXiv: General Finance},
  • Da-hang Li
  • Published 2020
  • Economics, Mathematics
  • arXiv: General Finance
  • The St. Petersburg paradox, an important topic in probability theory, has not been solved last 280 years. Since Nicolaus Bernoulli proposed the St. Petersburg Paradox in 1738, many people had tried to solve it and had proposed various explanations, but all are not satisfactory. In the paper we proposed a new pricing theory with several rules, which incidentally resolves this paradox. The new pricing theory states that so-called fair (reasonable) pricing should be judged by the seller and the… CONTINUE READING


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