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 ...

Discover the concept of utility in microeconomics, exploring its origins, types, and applications to analyze consumer ...

Investopedia contributors come from a range of backgrounds, and over 25 years there have been thousands of expert writers and editors who have contributed. Robert Kelly is managing director of XTS ...

Utility functions offer a means to encode objectives and preferences in investor portfolios. The functions allow one to place a score on outcomes and then identify optimal portfolios by maximizing ...