Goldman Sachs Interview Question: Suppose that you have a fair ... | Glassdoor

Interview Question

Summer Internship - Quantitative Investment Strategies Interview(Student Candidate) New York, NY

Suppose that you have a fair coin. You start with $0. You

  win 1$ each time you get a head and loose $1 each time you get tails. Calculate the probability of getting $2 without getting below $0 at any time.
Answer

Interview Answer

5 Answers

3

Draw a tree to have an idea of how to compute the probability. The flips are all independent with each other.

Interview Candidate on Apr 10, 2012
0

1/3

Vipin Agrawal on Sep 2, 2013
1

1/3
Because if he requires 2 heads = $2, then it means he require HH out of {HH,HT ,TH,TT}
We cannot consider TT because it would turn to zero. Therefore, he has 1 chance out of 3. Hence 1/3.

Karan More on Jan 31, 2015
0

Each flip has a .5 possibility of being head.
(.5)(.5)=.25 or 1/4

Anonymous on Dec 21, 2016
0

Marchov chain with 2 and -1 absorbing OR geometric series 1/4^n from 1 to inf=1/3

Anonymous on Sep 18, 2017

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