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Double-headed coin among a thousand after ten heads

Question

Among 1,0001{,}000 coins, 999999 are fair and one has two heads. You pick a coin at random and toss it ten times, getting ten heads. What is the probability that you picked the two-headed coin?

Short answer

1024/2023≈0.5061024/2023\approx0.506. By Bayes, 1100011000+9991000⋅2−10=10241024+999\dfrac{\tfrac1{1000}}{\tfrac1{1000}+\tfrac{999}{1000}\cdot2^{-10}}=\dfrac{1024}{1024+999}. Ten heads is roughly a 1-in-1000 event for a fair coin, matching the prior odds, so it ends up close to even.

Adapted from Zhou, A Practical Guide to Quantitative Finance Interviews, sec. 4.3 Conditional Probability and Bayes' Formula, 'Unfair coin', p.73; question and answer rewritten by SelfMadeQuant.com.

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