The Standard Model of Rational Risky Decision-Making
Expected utility theory (EUT) is currently the standard framework which formally defines rational decision-making under risky conditions. EUT uses a theoretical device called von Neumann–Morgenstern utility function, where concepts of function and random variable are employed in their pre-set-theore...
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Format: | Article |
Language: | English |
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MDPI AG
2021-04-01
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Series: | Journal of Risk and Financial Management |
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Online Access: | https://www.mdpi.com/1911-8074/14/4/158 |