who came up with expected utility theory?
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In the 1950s Leonard Jimmie Savage, an American statistician, derived a framework for comprehending expected utility. At that point, it was considered the first and most thorough foundation to understanding the concept.
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An economic theory proposed by professor and economist F.B. Hawley states that profit is a reward for risk taken in business. According to Hawley, the higher the risk in business, the greater the potential financial reward is for the business owner.
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It's difficult to measure a qualitative concept such as utility, but economists try to quantify it in two different ways: cardinal utility and ordinal utility. Both of these values are imperfect, but they provide an important foundation for studying consumer choice.
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http://www.ted.com Behavioral economist Dan Ariely, the author of Predictably Irrational, uses classic visual illusions and his own counterintuitive (and sometimes shocking) research findings to show how we're not as rational as we think when we make decisions.
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The mathematical methods of probability arose in the investigations first of Gerolamo Cardano in the 1560s (not published until 100 years later), and then in the correspondence Pierre de Fermat and Blaise Pascal (1654) on such questions as the fair division of the stake in an interrupted game of chance.
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Economic Assumptions People have rational preferences among outcomes that can be identified and associated with a value. Individuals maximize utility (as consumers) and firms maximize profit (as producers). People act independently on the basis of full and relevant information.
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Subjective theory of value is the idea that an object's value is not inherent and is instead worth more to different people based on how much they desire or need the object.
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Definition of subjective utility. : the utility or satisfaction an article gives to an individual based upon his personal judgment and desires rather than upon market judgment.
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The expected value (EV) is an anticipated value for an investment at some point in the future. In statistics and probability analysis, the expected value is calculated by multiplying each of the possible outcomes by the likelihood each outcome will occur and then summing all of those values.
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Anne Treisman proposed her selective attention theory in 1964. His theory is based on the earlier model by Broadbent. Treisman also believed that this human filter selects sensory inputs on the basis of physical characteristics.
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The theory receives explicit treatment by Adam Smith and Henry Sidgwick; Roderick Firth is the most well-known proponent of the theory in the twentieth century. There are two versions of the theory.
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The contingency theory of leadership was proposed by the Austrian psychologist Fred Edward Fiedler in his landmark 1964 article, "A Contingency Model of Leadership Effectiveness." The contingency theory emphasizes the importance of both the leader's personality and the situation in which that leader operates.
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The Theory of Reasoned Action was developed by Martin Fishbein and Icek Ajzen in 1975 as an improvement over the information integration theory. Fishbein and Ajzen formulated the theory after trying to determine the differences between attitude and behavior.
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One of the most influential ideas about this was the notion of "zero defects." This phrase was coined by Philip Crosby in his 1979 book titled, "Quality is Free." His position was that where there are zero defects, there are no costs associated with issues of poor quality; and hence, quality becomes free.
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In economics, utility function is an important concept that measures preferences over a set of goods and services. Utility represents the satisfaction that consumers receive for choosing and consuming a product or service.
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The is–ought problem, as articulated by the Scottish philosopher and historian David Hume, states that many writers make claims about what ought to be, based on statements about what is. ... The is–ought problem is closely related to the fact–value distinction in epistemology.
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Alfred Marshall's Principles of Economics [Marshall, 1890] is well known for its contributions to the theory of value. It is less widely appreciated that the book also contains a well-developed theory of distribution.