Meeting 21: Decisions and Utility
Reading: AIAMA 16.1-16.3
In order to make an action decision an agent needs to know more than the probability of an outcome, it also needs the cost associated with making a mistake. This can be expressed as a gain or loss in terms of a utility. In this meeting we will look at how to combine probabilities with utility to reach rational decisions under uncertainty.
Questions you should be able to answer after reading are:
- What is a utility function?
- How does one compute the expected utility?
- Why is it rational to maximize the expected utility?
- What are the constraints on rational preferences?
- How do rational preferences map onto utility functions?
- What are some semantic interpretations of utility in the real world?
- What is the difference between a normative and descriptive theory and how does it apply to human decisions?
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