Expected Utility Theory
Preference relations can also be applied to a space of simple lotteries, as in expected utility theory. In this case a preference structure over lotteries can also be represented by a utility function.
Read more about this topic: Preference (economics)
Famous quotes containing the words expected, utility and/or theory:
“There were ghosts that returned to earth to hear his phrases,
As he sat there reading, aloud, the great blue tabulae.
They were those from the wilderness of stars that had expected more.
There were those that returned to hear him read from the poem of life,
Of the pans above the stove, the pots on the table, the tulips among them.
They were those that would have wept to step barefoot into reality....”
—Wallace Stevens (1879–1955)
“Moral sensibilities are nowadays at such cross-purposes that to one man a morality is proved by its utility, while to another its utility refutes it.”
—Friedrich Nietzsche (1844–1900)
“The great tragedy of science—the slaying of a beautiful theory by an ugly fact.”
—Thomas Henry Huxley (1825–1895)