Although real-world decision makers often have complex utility functions, we will first consider the simplest case: a hypothetical decision-maker faced with a chose between two gambles who has a ...

At first glance it seems that any (non-decreasing) utility function would point to the log-optimal portfolio, at least in the limit. This is known not to be the case. In this work we identify ...

In this problem, the optimal path is one that maximizes the expected utility, with the utility function being piecewise-linear and concave. Such a utility function can be used to approximate nonlinear ...

One of the classic observations in investment theory is that maximizing the expected-log-return of a portfolio results in the greatest long-term growth of wealth. The log-optimal portfolio is both ...

To determine whether the Visual Function Questionnaire-25 (VFQ) is a more accurate instrument for assessing vision related quality of life (VRQOL) than visual acuity (VA) in patients with diabetic ...

The utility function measures a consumer’s preference for goods or services in terms of satisfaction. Learn how to calculate it and why it’s important to economists and businesses.

In cases where the utility function is increasing with upper and lower bounds then the utility function can be characterized by a distribution function, and we can take advantage of the various ...

Discover the inconsistency of the quadratic Mincer Equation in utility maximization assumptions. Explore the dynamic version and isoelastic marginal utility function, revealing the need for a ...

The utility function can be used to derive the demand function, and both concepts relate to utility maximization.