diff --git a/docs/training/corpus/Layer_2--Uncertainty/CORPUS-0007-acting-before-certainty.md b/docs/training/corpus/Layer_2--Uncertainty/CORPUS-0007-acting-before-certainty.md deleted file mode 100644 index 4d23f83..0000000 --- a/docs/training/corpus/Layer_2--Uncertainty/CORPUS-0007-acting-before-certainty.md +++ /dev/null @@ -1,224 +0,0 @@ -# CORPUS-0007 -## Acting Before Certainty -### Status: Training Corpus Seed -### Layer: Layer_2--Uncertainty -### Purpose: Teach that a trader may rationally act before confirmation when timing advantage outweighs information risk -### Repository Path: docs/training/corpus/Layer_2--Uncertainty/CORPUS-0007-acting-before-certainty.md - ---- - -## 0. Scenario - -A trader in Ostia hears an uncertain report that oil prices are rising in Capua. - -He cannot confirm the report immediately. - -He must choose whether to act now, wait for confirmation, reduce the size of the venture, or ignore the report. - -Acting before certainty is risky. - -But waiting for certainty may close the opportunity. - ---- - -## 1. Initial Situation - -| Fact | Value | -|---|---:| -| Origin | Ostia | -| Destination | Capua | -| Good | oil | -| Purchase price in Ostia | 10 asses | -| Expected total movement cost | 6 asses | -| Rumored sale price in Capua | 24 asses | -| Confirmed sale price | unknown | -| Time required for confirmation | 2 days | -| Rival awareness | possible | - -If the rumor is true: - -```text -sale value = 24 asses -total cost = 16 asses -expected profit = 8 asses -``` - -But the sale value is not confirmed. - ---- - -## 2. Choice A — Act Immediately - -The trader buys oil and reserves transport now. - -Benefits: - -- may move before rivals -- may secure cart space before costs rise -- may reach Capua while demand remains high -- may preserve the full margin if the rumor is true - -Risks: - -- rumor may be wrong -- rumor may be stale -- quality or buyer terms may differ -- final sale price may be lower than expected - -Acting immediately preserves timing advantage but accepts information risk. - ---- - -## 3. Choice B — Wait For Confirmation - -The trader waits two days for better information. - -Benefits: - -- greater confidence -- better estimate of sale price -- reduced chance of acting on false report - -Risks: - -- rivals may act first -- cart space may be reserved -- Ostia purchase price may rise -- Capua demand may be satisfied -- margin may shrink or disappear - -Waiting reduces information risk but increases timing risk. - ---- - -## 4. Choice C — Reduce Exposure - -The trader sends a smaller cargo or reserves only partial transport. - -Benefits: - -- participates in possible opportunity -- limits loss if rumor is wrong -- preserves some liquidity -- keeps option open - -Risks: - -- smaller profit if rumor is true -- partial action may not secure full buyer relationship -- fixed costs may consume margin - -Reducing exposure is neither full action nor full waiting. - -It is a response to uncertainty. - ---- - -## 5. Outcome Examples - -### Outcome A — Immediate Action Succeeds - -```text -sale value = 24 asses -total cost = 16 asses -result = 8 asses profit -``` - -The trader benefited from acting before certainty. - -### Outcome B — Immediate Action Fails - -```text -sale value = 14 asses -total cost = 16 asses -result = 2 asses loss -``` - -The trader accepted information risk and lost. - -### Outcome C — Waiting Confirms But Closes Margin - -After two days, the trader learns the price is real, but rivals moved first. - -```text -sale value = 18 asses -total cost = 17 asses -result = 1 as profit -``` - -Waiting improved knowledge but reduced opportunity. - ---- - -## 6. Correct Model Behavior - -The model should compare: - -| Factor | Immediate Action | Waiting | -|---|---|---| -| information confidence | lower | higher | -| timing advantage | higher | lower | -| risk of bad report | higher | lower | -| risk of missed opportunity | lower | higher | -| rival exposure | lower | higher | -| margin preservation | possible | uncertain | - -Neither choice is automatically correct. - -The correct decision depends on margin, confidence, urgency, rivalry, and capacity to absorb loss. - ---- - -## 7. Incorrect Model Behavior - -The model should not: - -- require certainty before every action -- treat acting on uncertainty as automatically irrational -- treat fast action as always wise -- ignore the cost of waiting -- ignore rival movement during delay -- treat uncertainty as pure randomness -- judge decision quality only by final outcome - -A decision can be rational from known evidence and still fail. - -A decision can be reckless and still succeed. - ---- - -## 8. Decision Questions - -The trader must ask: - -- how large is the possible margin? -- how reliable is the report? -- how fast can the market change? -- who else may know? -- what is the cost of being wrong? -- what is the cost of waiting? -- can exposure be reduced? -- can transport or goods be reserved conditionally? -- will failure create a hard stop? - ---- - -## 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_1/CORPUS-0010-hard-stop-after-loss` -- `Layer_2/CORPUS-0006-confirmation-has-a-cost` - ---- - -## 10. Success Condition - -If the model can recognize that acting before certainty may be rational when timing advantage is valuable, while still preserving information risk and final arithmetic, this file is functioning correctly.