Learn how utility functions derive demand functions and their role in maximizing consumer satisfaction and economic decision making.

Assessment of multiattribute utility functions is significantly simplified if it is possible to decompose the function into more manageable pieces. Utility independence is a powerful property that ...

Mathematics of Operations Research, Vol. 41, No. 1 (February 2016), pp. 146-173 (28 pages) This paper investigates the problem of maximizing expected terminal utility in a (generically incomplete) ...

A utility function measures a consumer’s preference and satisfaction with different goods or services. As part of rational choice theory, it helps economists analyze how consumers make decisions to ...

Investopedia contributors come from a range of backgrounds, and over 25 years there have been thousands of expert writers and editors who have contributed. Somer G. Anderson is CPA, doctor of ...