Expected Utility Calculator
Expected Utility Calculator
| Component | Description |
|---|---|
| Outcome | The potential result or payoff of a decision or action. |
| Probability | The likelihood of a particular outcome occurring. |
| Utility | A measure of satisfaction or value derived from an outcome. |
| Expected Utility | The weighted average of utilities across all possible outcomes, weighted by their probabilities. |
| Formula | Expected Utility = Σ (Probability of Outcome × Utility of Outcome) |
| Purpose | Used in decision-making to evaluate and compare the expected satisfaction or value of different choices. |