Dutch book

Dutch book a bet or combination of bets whereby the bettor is bound to suffer a net loss regardless of the outcome. A simple example would be a bet on a proposition p at odds of 3 : 2 combined with a bet on not-p at the same odds, the total amount of money at stake in each bet being five dollars. Under this arrangement, if p turned out to be true one would win two dollars by the first bet but lose three dollars by the second, and if p turned out to be false one would win two dollars by the second bet but lose three dollars by the first. Hence, whatever happened, one would lose a dollar. See also PROBABILITY. R.Ke.

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