Expected monetary value is the expected utility of a lottery, gamble, or investment, determined by taking a weighted average of the utility of the monetary prizes offered using the associated probabilities as weights.

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Expected monetary value is calculated as a weighted average of all possible outcomes, using the monetary values of the outcomes and their associated probabilities as weights, not the utility of the monetary prizes. Utility is a separate concept often used in risk analysis and decision-making to account for an individual's or organization's risk preferences.

Expected Monetary Value Is the Expected Utility of a Lottery