Click again to stop the play. If you are viewing this over a telephone modem internet connection, playing the voice recordings involves loading delays of several minutes. Utility is an imaginary quantity that goes up when you have more of something you like and down when you have less. According to standard economic theory, people go through life trying to maximize their utility. 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.