Fyi, an imho more illustrative example why we should think in terms of expected utility than expected cash flows: https://en.wikipedia.org/wiki/St._Petersburg_

Fyi, an imho more illustrative example why we should think in terms of expected utility than expected cash flows: https://en.wikipedia.org/wiki/St._Petersburg_paradox https://en.wikipedia.org/wiki/St._Petersburg_paradox tl;dr: doubling winnings on each throw of heads and paying out on the first tail is a game with expected winnings diverging to positive infinity, yet probably no one would pay more than a few bucks to enter