The Utility of Wealth

@article{Markowitz1952TheUO,
  title={The Utility of Wealth},
  author={Harry M. Markowitz},
  journal={Journal of Political Economy},
  year={1952},
  volume={60},
  pages={151 - 158}
}
  • H. Markowitz
  • Published 1 April 1952
  • Economics
  • Journal of Political Economy
(b) acts in the face of known odds so as to maximize expected utility. (2) The utility function is as illustrated in Figure i. We may assume it to be a continuous curve with at least first and second derivatives.5 Let U be utility and W be wealth. Below some point A, (a2U)/(0W2) < o; between A and B, (02U)/Q(W2) > o; above B, (02U)/(0W2) < a. To tell geometrically whether or not an individual would prefer Wo with certainty or a "fair"6 chance of rising to WI or falling to 
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