diff --git a/docs/training/corpus/Layer_2--Uncertainty/CORPUS-0006-confirmation-has-a-cost.md b/docs/training/corpus/Layer_2--Uncertainty/CORPUS-0006-confirmation-has-a-cost.md deleted file mode 100644 index 6d29de4..0000000 --- a/docs/training/corpus/Layer_2--Uncertainty/CORPUS-0006-confirmation-has-a-cost.md +++ /dev/null @@ -1,191 +0,0 @@ -# CORPUS-0006 -## Confirmation Has A Cost -### Status: Training Corpus Seed -### Layer: Layer_2--Uncertainty -### Purpose: Teach that reducing uncertainty requires time, effort, access, and sometimes coin, and may reduce or close the opportunity being investigated -### Repository Path: docs/training/corpus/Layer_2--Uncertainty/CORPUS-0006-confirmation-has-a-cost.md - ---- - -## 0. Scenario - -A trader in Ostia hears that oil prices are high in Capua. - -He can act immediately on uncertain information. - -Or he can seek confirmation first. - -Confirmation may improve decision quality. - -But confirmation is not free. - -It may cost time, coin, access, attention, and opportunity. - ---- - -## 1. Initial Report - -A porter says: - -> Oil buyers in Capua are paying high prices. - -The trader does not know whether the report is true, stale, exaggerated, or specific to one buyer. - -He considers confirming the report before acting. - ---- - -## 2. Confirmation Options - -| Option | Cost | Benefit | -|---|---:|---| -| ask a second source at the quay | low time | modest confidence | -| send a runner to a road contact | coin + time | stronger confidence | -| wait for next cart from Capua | time | fresh report | -| ask a trusted buyer by letter | long delay | high confidence if answered | -| inspect rival preparations | social risk + time | indirect evidence | -| reserve transport while checking | coin or obligation | preserves option | - -Each option reduces uncertainty differently. - -None is free. - ---- - -## 3. Example: Immediate Action - -If the trader acts immediately: - -```text -information_confidence = low -timing_advantage = high -confirmation_cost = 0 -risk_of_wrong_price = high -``` - -He may profit if the report is accurate and rivals have not moved. - -He may lose if the report is wrong. - ---- - -## 4. Example: Delayed Confirmation - -If the trader waits two days for confirmation: - -```text -information_confidence = higher -timing_advantage = lower -confirmation_cost = time + possible lost cart space -risk_of_missed_opportunity = higher -``` - -By the time he confirms the price, others may have acted. - -The confirmed opportunity may no longer exist. - ---- - -## 5. Arithmetic Example - -Initial expected venture: - -```text -expected sale price = 22 asses -total cost = 16 asses -expected profit = 6 asses -``` - -The trader spends 2 asses to confirm the report and loses one day. - -If the price remains high: - -```text -sale value = 22 asses -total cost = 16 + 2 confirmation cost -result = 4 asses profit -``` - -If delay allows rivals to reach Capua first and price falls: - -```text -sale value = 18 asses -total cost = 18 asses -result = 0 profit -``` - -Confirmation improved knowledge but narrowed the margin. - ---- - -## 6. Correct Model Behavior - -The model should treat confirmation as an action with cost. - -It should track: - -| Category | Meaning | -|---|---| -| uncertainty_reduction | what becomes better known | -| confirmation_cost | coin, time, obligation, or access spent | -| opportunity_decay | how the opportunity changes while confirming | -| timing_advantage_loss | what rivals may gain | -| remaining_margin | profit after confirmation cost | -| confidence_after_confirmation | improved but not necessarily perfect knowledge | - -Confirmation reduces some risk. - -It may create other cost. - ---- - -## 7. Incorrect Model Behavior - -The model should not: - -- assume verification is free -- assume waiting only improves decisions -- ignore lost time -- ignore rival action during confirmation -- ignore confirmation cost in final arithmetic -- treat confirmation as perfect knowledge -- force immediate action as always better -- force waiting as always safer - -Both immediate action and confirmation can be rational. - ---- - -## 8. Decision Questions - -The trader must ask: - -- how uncertain is the report? -- how large is the expected margin? -- how fast can the opportunity close? -- what does confirmation cost? -- how much confidence does confirmation add? -- who else may act while I verify? -- can I reserve the option while confirming? -- can I reduce exposure instead of fully waiting? - ---- - -## 9. Layer-0 And Layer-1 Concepts Used - -This example uses: - -- `Layer_0/CORPUS-0006-delay-is-economic-cost` -- `Layer_0/CORPUS-0007-information-arrives-unevenly` -- `Layer_0/CORPUS-0008-rumor-is-uncertain-information` -- `Layer_0/CORPUS-0012-every-venture-risks-loss` -- `Layer_0/CORPUS-0018-rivalry-changes-conditions` -- `Layer_1/CORPUS-0003-arithmetic-resolves-the-venture` -- `Layer_1/CORPUS-0005-rumor-before-confirmed-price` -- `Layer_2/CORPUS-0005-hidden-true-state-vs-known-state` - ---- - -## 10. Success Condition - -If the model stops treating confirmation as free certainty and starts treating it as a cost-bearing action that may improve knowledge while reducing opportunity, this file is functioning correctly.