Buffett’s decision process is an exercise in subjective probability. He explains: “If I think there is a 90 percent chance of occurring and there is 3 points on the upside and there is a 10 percent chance that it will fall through and there is 9 points on the downside, then that’s $0.90 off of $2.70, leaving $1.80 mathematical expectation.”15
Exmple of how to calculate probaility with abott price going from 18 to 27 cause of chances of a merger at $30 per share
