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Utility Software Types
As a topic of economics, utility is used to model worth or value. Its usage has evolved significantly over time. The term was introduced initially as a measure of pleasure or happiness as part of the theory of utilitarianism by moral philosophers such as Jeremy Bentham and John Stuart Mill. The term has been adapted and reapplied within neoclassical economics, which dominates modern economic theory, as a utility function that represents a single consumer's preference ordering over a choice set but is not comparable across consumers. This concept of utility is personal and based on choice rather than on pleasure received, and so is specified more rigorously than the original concept but makes it less useful (and controversial) for ethical decisions. Utility function Consider a set of alternatives among which a person can make a preference ordering. The utility obtained from these alternatives is an unknown function of the utilities obtained from each alternative, not the sum of ...
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Economics
Economics () is a social science that studies the Production (economics), production, distribution (economics), distribution, and Consumption (economics), consumption of goods and services. Economics focuses on the behaviour and interactions of Agent (economics), economic agents and how economy, economies work. Within mainstream economics, microeconomics is a field which analyzes what's viewed as basic elements in the economy, including individual agents and market (economics), markets, their interactions, and the outcomes of interactions. Individual agents may include, for example, households, firms, buyers, and sellers. Macroeconomics analyzes the economy as a system where production, consumption, saving, and investment interact, and factors affecting it: employment of the resources of labour, capital, and land, currency inflation, economic growth, and public policies that have impact on glossary of economics, these elements. Other broad distinctions within economics in ...
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Edgeworth Box
In economics, an Edgeworth box, sometimes referred to as an Edgeworth-Bowley box, is a graphical representation of a market with just two commodities, ''X'' and ''Y'', and two consumers. The dimensions of the box are the total quantities Ω''x'' and Ω''y'' of the two goods. Let the consumers be Octavio and Abby. The top right-hand corner of the box represents the allocation in which Octavio holds all the goods, while the bottom left corresponds to complete ownership by Abby. Points within the box represent ways of allocating the goods between the two consumers. Market behaviour will be determined by the consumers' indifference curve, indifference curves. The blue curves in the diagram represent indifference curves for Octavio, and are shown as convex from his viewpoint (i.e. seen from the bottom left). The orange curves apply to Abby, and are convex as seen from the top right. Moving up and to the right increases Octavio's allocation and puts him onto a more desirable indifference ...
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Paul Samuelson
Paul may refer to: *Paul (given name) Paul () is a common masculine given name in countries and ethnicities with a Christian heritage (Eastern Orthodoxy The Eastern Orthodox Church, officially the Orthodox Catholic Church, is the List of Christian denominations by number of m ..., a given name (includes a list of people with that name) *Paul (surname)Paul is the surname of: Surname * Aaron Paul (born 1979), American actor * Adrian Paul (born 1959), English actor * Aislinn Paul (born 1994), Canadian actress * Alexandra Paul (born 1963), American actress * Alice Paul (1885–1977), American suffr ..., a list of people People Christianity *Paul the Apostle Paul; el, Παῦλος, translit=Paulos; cop, ⲡⲁⲩⲗⲟⲥ; he, פאולוס השליח, name=, group= (born Saul of Tarsus;; ar, بولس الطرسوسي; el, Σαῦλος Ταρσεύς, Saũlos Tarseús; tr, Tarsuslu Pavlus AD ... (AD 5–67), also known as Saul of Tarsus or Saint Paul, early ...
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Function (mathematics)
In mathematics Mathematics (from Greek: ) includes the study of such topics as numbers (arithmetic and number theory), formulas and related structures (algebra), shapes and spaces in which they are contained (geometry), and quantities and their changes (cal ..., a functionThe words map, mapping, transformation, correspondence, and operator are often used synonymously. . from a set to a set assigns to each element of exactly one element of . The set is called the domain Domain may refer to: Mathematics *Domain of a function, the set of input values for which the (total) function is defined **Domain of definition of a partial function **Natural domain of a partial function **Domain of holomorphy of a function *Doma ... of the function and the set is called the codomain In mathematics Mathematics (from Ancient Greek, Greek: ) includes the study of such topics as quantity (number theory), mathematical structure, structure (algebra), space (geometry), and calculus ...
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Microeconomics
Microeconomics is a branch of mainstream economics Mainstream economics is the body of knowledge, theories, and models of economics, as taught by universities worldwide, that are generally accepted by economists as a basis for discussion. Also known as orthodox economics, it can be contrasted to he ... that studies the behavior of individuals and firms Business is the activity of making one's living or making money by producing or buying and selling products (such as goods and services). Simply put, it is "any activity or enterprise entered into for profit." Having a business name A trade ... in making decisions regarding the allocation of scarce resources and the interactions among these individuals and firms. Microeconomics focuses on the study of individual markets, sectors, or industries as opposed to the national economy as whole, which is studied in macroeconomics Macroeconomics (from the Greek prefix ''makro-'' meaning "large" + ''economics'') is a branch of ...
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Preference (economics)
In economics Economics () is a social science that studies the Production (economics), production, distribution (economics), distribution, and Consumption (economics), consumption of goods and services. Economics focuses on the behaviour and interact ... and other social science Social science is the branch A branch ( or , ) or tree branch (sometimes referred to in botany Botany, also called , plant biology or phytology, is the science of plant life and a branch of biology. A botanist, plant scientist o ...s, preference is the order that a person (an agent) gives to alternatives based on their relative utility As a topic of economics Economics () is a social science Social science is the Branches of science, branch of science devoted to the study of society, societies and the Social relation, relationships among individuals within thos ..., a process which results in an optimal "choice A choice is the range of different things ...
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Intelligent Agent
In artificial intelligence Artificial intelligence (AI) is intelligence Intelligence has been defined in many ways: the capacity for abstraction Abstraction in its main sense is a conceptual process where general rules and concept Concepts are defined as abstra ..., an intelligent agent (IA) is anything which perceives its environment, takes actions autonomous The federal subject The federal subjects of Russia, also referred to as the subjects of the Russian Federation (russian: субъекты Российской Федерации, subyekty Rossiyskoy Federatsii) or simply as the subjects o ...ly in order to achieve goals, and may improve its performance with learning Learning is the process of acquiring new understanding Understanding is a psychological process related to an abstract or physical thing, such as a person, situation, or message whereby one is able to use concepts to model that thing. Under ... or may use knowledge Knowle ...
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Artificial Intelligence
Artificial intelligence (AI) is intelligence Intelligence has been defined in many ways: the capacity for abstraction Abstraction in its main sense is a conceptual process where general rules and concept Concepts are defined as abstract ideas or general notions that occur in the mind, ... demonstrated by machine A machine is any physical system with ordered structural and functional properties. It may represent human-made or naturally occurring device molecular machine A molecular machine, nanite, or nanomachine is a molecular component that produce ...s, unlike the natural intelligence displayed by humans and animals Animals (also called Metazoa) are multicellular Multicellular organisms are organism In biology, an organism (from Ancient Greek, Greek: ὀργανισμός, ''organismos'') is any individual contiguous system that embodies the L ..., which involves consciousness and emotionality. The distinction between the former and the la ...
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Entropic Risk Measure
In financial mathematics Mathematical finance, also known as quantitative finance and financial mathematics, is a field of applied mathematics, concerned with mathematical modeling of financial markets. See Quantitative analyst. In general, there exist two separate branch ... (concerned with mathematical modeling of financial markets), the entropic risk measure is a risk measure In financial mathematics, a risk measure is used to determine the amount of an asset or set of assets (traditionally currency) to be kept in reserve. The purpose of this reserve is to make the downside risk, risks taken by financial institutions, ... which depends on the risk aversion In economics Economics () is a social science Social science is the Branches of science, branch of science devoted to the study of society, societies and the Social relation, relationships among individuals within those societies ... of the user through the exponential utility In economics and finance, e ...
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Risk Measure
In financial mathematics Mathematical finance, also known as quantitative finance and financial mathematics, is a field of applied mathematics, concerned with mathematical modeling of financial markets. See Quantitative analyst. In general, there exist two separate branch ..., a risk measure is used to determine the amount of an asset In financial accounting Financial accounting is the field of accounting Accounting or Accountancy is the measurement, processing, and communication of financial and non financial information about economic entity, economic entities such a ... or set of assets (traditionally currency A currency, "in circulation", from la, currens, -entis, literally meaning "running" or "traversing" in the most specific sense is money Money is any item or verifiable record that is generally accepted as payment for goods and services ...) to be kept in reserve. The purpose of this reserve is to make the risks In simple terms, risk is the poss ...
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Indifference Price
In finance, indifference pricing is a method of pricing financial securities with regard to a utility function. The indifference price is also known as the reservation price or private valuation. In particular, the indifference price is the price at which an agent would have the same expected utility level by exercising a financial transaction as by not doing so (with optimal trading otherwise). Typically the indifference price is a pricing range (a bid–ask spread) for a specific agent; this price range is an example of good-deal bounds. Mathematics Given a utility function u and a claim C_T with known payoffs at some terminal time T, let the function V: \mathbb \times \mathbb \to \mathbb be defined by : V(x,k) = \sup_ \mathbb\left[u\left(X_T + k C_T\right)\right], where x is the initial endowment, \mathcal(x) is the set of all self-financing portfolios at time T starting with endowment x, and k is the number of the claim to be purchased (or sold). Then the indifference bid pr ...
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Asset
In financial accounting Financial accounting is the field of accounting Accounting or Accountancy is the measurement, processing, and communication of financial and non financial information about economic entity, economic entities such as businesses and corporatio ..., an asset is any resource Resource refers to all the materials available in our environment which help us to satisfy our needs and wants. Resources can broadly be classified upon their availability — they are classified into renewable File:Global Vegetation.jpg, Global ... owned or controlled by a business or an economic entity. It is anything (tangible or intangible) that can be used to produce positive economic value In economics Economics () is the social science that studies how people interact with value; in particular, the Production (economics), production, distribution (economics), distribution, and Consumption (economics), consumption of goo .... Assets represent value of ownershi ...
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