Why transforming utility function will not change decision making process

Discussion in 'CT8' started by wzlee12, Nov 24, 2017.

  1. wzlee12

    wzlee12 Member

    Hi guys!

    It has been a long time! May I ask why adding a constant to a utility function, or multiplying it by a constant will not affect the decision making process?

    I know this statement is in Chapter 2, and I came across a proof from this file in page 9, but I still do not get the logic.

    http://home.uchicago.edu/rmyerson/teaching/util206.pdf

    Can someone help me?

    Really thanks a lot! :D

    Regards,
    Lee Wei Zhe.
     

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