Internal consistency
Sometimes it's difficult to explain to others this concept in the context of statistics and insurance. So, it's a good opportunity for me to blog about this using price of food as an example.
One day, Ban and I were at 6 - 10 Grill & Nasi Lemak restaurant at Aman Suria. I saw the price of the nasi lemak and I pointed to him that the prices were a little strange:
Nasi lemak with
(a) 1 dish - RM8.50
(b) 2 dishes - RM11.50
(c) 3 dishes - RM15.00
To better explain what I meant, I used an example: let's say I wanted to order nasi lemak with 1 dish whereas he wanted the one with 3 dishes. If we were to order (a) and (c), then the total cost is RM23.50. However, if we were to order two servings of (b) and I pass 1 dish to him (so that he has 3 dishes altogether and I have 1 dish), then the total cost is RM23.00.
How did this happen? Note that the cost of increasing by 1 dish is RM3 from (a) to (b) but it's RM3.50 from (b) to (c) and thus causing internal inconsistency.
One day, Ban and I were at 6 - 10 Grill & Nasi Lemak restaurant at Aman Suria. I saw the price of the nasi lemak and I pointed to him that the prices were a little strange:
Nasi lemak with
(a) 1 dish - RM8.50
(b) 2 dishes - RM11.50
(c) 3 dishes - RM15.00
To better explain what I meant, I used an example: let's say I wanted to order nasi lemak with 1 dish whereas he wanted the one with 3 dishes. If we were to order (a) and (c), then the total cost is RM23.50. However, if we were to order two servings of (b) and I pass 1 dish to him (so that he has 3 dishes altogether and I have 1 dish), then the total cost is RM23.00.
How did this happen? Note that the cost of increasing by 1 dish is RM3 from (a) to (b) but it's RM3.50 from (b) to (c) and thus causing internal inconsistency.
Comments
It's good but I think Cinta Ria's one is better. It's been a while.