ordinal utility - monotonic transformation
just studying for microeconomics final when suddenly:
“We typically represent a monotonic transformation by a function of f(u) that transforms each number u into some other number f(u), in a way that preserves the order of the numbers in the sense that u1>u2 implies that f(u1) > f(u2).”
and i was like,
the passage ended with:
“The rate of change of f(u) as u changes can be measured by looking at the change in f between two values of u, divided by the change in u.”
i get it. ordinal utility = f(u) that changes, but ultimately, f(u).
let’s give a hand to all the economists who came up with this.
