Poker Pot Odds - Quant Trader Interview Question
Difficulty: Medium
Category: Conditional Expected Value
Practice quant interview questions from top firms including Jane Street, Citadel, Two Sigma, DE Shaw, and other leading quantitative finance companies.
Topics: pot-odds, probability, expected-value, decision-making, mental-math
Problem Description
You are playing a hand of Texas Hold'em. The pot contains \$100. Your opponent bets \$50. You estimate that you have a 25% chance of winning the hand if you call. Should you call the bet based on pot odds alone?
In other words, determine if your equity justifies calling a bet of \$50 to win a total pot of \$150 (the original \$100 + the \$50 bet).
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