Measuring utility Sound applet Strictly speaking, utility is not observable. Utility exists only in theory, or in the thoughts of the person. We can observe how a person ranks alternatives, giving us an ordinal utility scale. But we can t compare or add one person s ordinal utility to another s. Measuring health Sound applet For health care, we can measure utility, if we identify it with length of life or health status, but that's a judgement call, and peoples' values differ.
Different people answer that question differently.
Both costs and benefits are evaluated in dollars and compared. The costs of alternative means of achieving some benefit are compared. The benefit itself is not evaluated in dollars. Evaluate the cost. Find if the cost is less than value of benefit.