Limit SMT Basic

2014

Problem - 4589

Moor has $\$1000$, and he is playing a gambling game. He gets to pick a number k between $0$ and $1$ (inclusive). A fair coin is then flipped. If the coin comes up heads, Moor is given $5000k$ additional dollars. Otherwise, Moor loses $1000k$ dollars. Moorâ€™s happiness is equal to the log
of the amount of money that he has after this gambling game. Find the value of k that Moor
should select to maximize his expected happiness.

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