Saturday, November 04, 2006

The Logic of Loss

Try this exercise with your team.

It starts with a story about a lady, a shopkeeper and a panwala. The lady walks into a shoe shop. Looks around. Tries on a few models. Finally decides to buy one that costs Rs.12. She goes to the check-out counter and hands a 20 rupee note to the shopkeeper. The shopkeeper does not have change. So he goes to the panwala across the street who happens to be his friend and asks him if he has change for the 20 rupees. Luckily the panwala has change. So the shopkeeper gives the 20 note to the panwala and gets 20 one rupee coins. He returns to the shop. Hand over the pair of shoes and the balance of Rs.8 to the lady. Lady leaves. Some more business happens. Half an hour later, the panwala comes to the shop and tells him that the 20 rupee note was a fake. He wants his money back. Since they are friends, the shopkeeper trusts the panwala to be telling the truth and gives him a genuine 20 rupee note in exchange for the fake.

Now, the question is: How much money did the shopkeeper loose? Simple arithmetic. You have 1 minute to think it over after which each person would have to give his answer to the group. See what happens.

PS: As you may have noticed, the story in the above example happened a long time ago.

No comments:

Post a Comment