Subjective expected utility

Subjective Expected Utility (SEU) is a decision theory framework that combines subjective beliefs about the likelihood of outcomes with utility values assigned to those outcomes. It is an extension of the expected utility theory, which is grounded in objective probabilities. ### Key Components of Subjective Expected Utility: 1. **Subjective Probabilities**: Instead of relying on objective probabilities, SEU allows individuals to use their personal beliefs or subjective judgments to assess the likelihood of different outcomes.