# Questions tagged [measuring-utility]

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### What's the formula for calculating the Marginal Rate of Substition using Total Utility function, total utility, quantities of both X, and Y?

The question is as follows: If the total utility function of two goods, X, and Y, is: TU = f(X,Y) = sqrt(XY), total utility is equal to 25, and X = 5, then what must the Y be? What's the Marginal Rate ...
154 views

### Is it accurate to state that an economist cannot assign a true numerical value for utility?

Investopedia article - What is the utility function and how is it calculated? https://www.investopedia.com/ask/answers/072915/what-utility-function-and-how-it-calculated.asp Article describes ordinal ...
47 views

### Is it considered acceptable or unacceptable to use currency as a measure of utility?

There will always exist at least one economist who condones measuring utility in US dollars and another who does not. However, I am wondering which way the majority of contemporary economists lean. ...
70 views

### Fair value that a risk averse individual would pay to enter a gamble

Introduction Assuming an individual (or corporation) with risk aversion and a von Neumann-Morgenstern utility curve and given a gamble g with E(g) > 0. From what I researched, certainty equivalent is ...
61 views

### Relationship between expected utility and independence axiom

Jonathan Levin in "Choice under Uncertainty" wrote in Theorem 1 " A complete and transitive preference relation on a set of lotteries P satisfies continuity and independence if and only if it admits ...