da6 - Engineering Risk Benefit Analysis 1.155, 2.943,...

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DA 6. Multiattribute Utility Theory 1 Engineering Risk Benefit Analysis 1.155, 2.943, 3.577, 6.938, 10.816, 13.621, 16.862, 22.82, ESD.72, ESD.721 DA 6. Multiattribute Utility Theory George E. Apostolakis Massachusetts Institute of Technology Spring 2007
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DA 6. Multiattribute Utility Theory 2 Consequences Not all the consequences are monetary. In risk management problems, for example, they may include the impact on health and safety of groups of stakeholders. In general, the consequences are described by a vector x (x 1 , …, x N ).
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DA 6. Multiattribute Utility Theory 3 Multiattribute Utility u(x 1 , …, x N ) Decision alternative A i is preferred over alternative A k if and only if its expected utility is greater, i.e., E i [u] > E k [u] A i A k f
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DA 6. Multiattribute Utility Theory 4 Finding u(x 1 , …, x N ) Use the certainty-equivalent approach: p 1-p ) x ,..., x ( * N * 1 ) x ,..., x ( * N * 1 ) x ,..., x ( N 1 1
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DA 6. Multiattribute Utility Theory 5 Independence Assumptions Finding the multiattribute utility function using the preceding method is very burdensome. Can we find a function f such that
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This note was uploaded on 11/08/2011 for the course AERO 16.851 taught by Professor Ldavidmiller during the Fall '03 term at MIT.

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da6 - Engineering Risk Benefit Analysis 1.155, 2.943,...

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