Expected increase in the number of deaths

Reference no: EM13968577

A decision maker who prefers Chemical B might be said to be sensitive to equity between the two groups. The eventual outcome with Chemical A is not equitable; one group is better off than the other. On the other hand, with Chemical B, both groups are treated the same. Let X andY denote the expected increase in the number of deaths in Groups 1 and 2, respectively, and denote a decision maker's utility function as

U(x, y) = kX UX(x) + kY UY(y) + (1 - kX - kY) UX(x) UY(y)

What can you say about the value of (1 - kX - kY)? Are X and Y complements or substitutes?

Reference no: EM13968577

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