Given its definition, expected utility theory is most applicable to deciding whether to
A) break up or stay involved with a current girlfriend.
B) go out for junior varsity hockey or junior varsity basketball.
C) buy first-class or coach tickets for a spring break trip.
D) take astronomy or geology as a physical science elective course.

Question

Quizplus · Accepted Answer

Expected utility theory is a normative theory that suggests that people should make decisions based on maximizing their expected utility, which is a measure of the relative desirability of different outcomes. In the case of buying first-class or coach tickets for a spring break trip, the decision could be framed in terms of the expected utility of each option. For example, the expected utility of buying first-class tickets might include more comfort and amenities, while the expected utility of buying coach tickets might include a lower price. By comparing the expected utility of each option, the decision-maker can make the best choice.

Given Its Definition, Expected Utility Theory Is Most Applicable to Deciding