Topic summary
Utility function
Extracted from the Wikipedia article Utility.
Utility function
Consider a set of alternatives among which a person has a preference ordering. A utility function represents that ordering if it is possible to assign a real number to each alternative in such a manner that alternative a is assigned a number greater than alternative b if and only if the individual prefers alternative a to alternative b. In this situation, someone who selects the most preferred alternative must also choose one that maximizes the associated utility function.