Utility theories

Utility theories are concepts in economics that describe how people make choices based on their preferences and the satisfaction or value they expect to gain from different options. Essentially, individuals aim to maximize their utility, or personal happiness, when deciding between alternatives. These theories assume that people weigh the potential benefits and risks of each option to select the one that provides the greatest overall benefit. Utility theories help explain decisions in everyday life, such as buying products, saving money, or choosing leisure activities, by modeling how choices align with individual preferences and perceived value.