Quoting Terry Tao, albeit with small modifications,
There is an island upon which a tribe resides. The tribe consists of 1000 people, with various eye colours. Yet, their religion forbids them to know their own eye color, or even to discuss the topic; thus, each resident can (and does) see the eye colors of all other residents, but has no way of discovering his or her own (there are no reflective surfaces). If a tribesperson does discover his or her own eye color, then their religion compels them to commit ritual suicide at noon the following day in the village square for all to witness. All the tribespeople are highly logical and devout, and they all know that each other is also highly logical and devout (and they all know that they all know that each other is highly logical and devout, and so forth).
For the purposes of this logic puzzle, “highly logical” means that any conclusion that can logically deduced from the information and observations available to an islander, will automatically be known to that islander.
Of the 1000 islanders, it turns out that 100 of them have blue eyes and 900 of them have brown eyes, although the islanders are not initially aware of these statistics (each of them can of course only see 999 of the 1000 tribespeople).
One day, a blue-eyed foreigner visits to the island and wins the complete trust of the tribe.
One evening, he addresses the entire tribe to thank them for their hospitality.
However, not knowing the customs, the foreigner makes the mistake of mentioning eye color in his address, remarking “how unusual it is to see another blue-eyed person like myself in this region of the world”.
What effect, if anything, does this faux pas have on the tribe?
Although, it might not initially be obvious this is a problem about thinking about thinking about thinking about thinking — and so on. As before, I will proceed with diagrams. One argument, which is inductive, proceeds in this way: if there were only one blue-eyed villager, he would not know his eyes were blue. Everyone else would know his eyes were blue. Because the stranger pointed out there was an individual with blue eyes, an individual our sole blue-eyed villager had never seen, he would immediately know it was him and kill himself the next day.
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