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Value/Utility Function Approach In Estimating Weights

The value/utility function approach is a way of transforming criterion maps to a common scale. The value or utility is a number that is attached to a possible decision outcome (or level of attribute). Each outcome has a value or utility. The utility (value) function converts different levels for an attribute into utility or value scores. It relates possible decision outcomes to a scale that reflects the decision maker’s relative preference. A value or utility function relates worth (usually measured on a scale of 0 to 1) to the attributes concerned. Thus the function is an expression yielding a standardized scale value for each value of a range of attribute data.

The term "value function" refers to a utility function in the context of a deterministic criterion or decision under certainty (Keeney and Raiffa 1976). It is assumed that the uncertainty involved in a decision situation is either a known or a negligible determinant of the utilities (values). The term "utility function" is restricted to a probabilistic criterion or decision under uncertainty, when the decision maker’s attitudes toward risk are an important determinant of the utilities (utility scores). In other words, the term "utility scores" may be applied in the context of both the value function and the utility function, while the term "value" is restricted to decision problems under certainty.

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