preferensfunktion

A preferensfunktion, also known as a utility function, is a mathematical representation of an individual's preferences over a set of alternatives. In economics, it is used to model consumer choice and predict how individuals will allocate their resources to maximize their satisfaction or well-being. A preferensfunktion assigns a numerical value, or utility, to each possible outcome or bundle of goods. Higher utility values indicate a stronger preference.

The fundamental assumption behind preferensfunktioner is that individuals are rational, meaning they can consistently rank their preferences. If an individual prefers option A to option B, and option B to option C, then they must also prefer option A to option C. This property is known as transitivity. Other common assumptions include completeness, where an individual can compare any two options, and reflexivity, where any option is considered at least as good as itself.

Preferensfunktioner can take many forms, but they all share the property of reflecting the ordinal ranking of preferences. This means that the absolute values of utility are less important than their relative order. For example, if a preferensfunktion assigns a utility of 10 to apples and 5 to bananas, it indicates a preference for apples, but it does not imply that apples provide twice the satisfaction of bananas. The concept is widely applied in microeconomics, game theory, and decision theory to analyze choices under various conditions, including uncertainty and risk.