A Utility Function to Solve Approximate Linear Equations for Decision Making
Journal Title: Decision Making in Manufacturing and Services - Year 2013, Vol 7, Issue 1
Abstract
Suppose there are a number of decision variables linearly related to a set of outcome variables. There are at least as many outcome variables as the number of decision variables since all decisions are outcomes by themselves. The quality of outcome is evaluated by a utility function. Given desired values for all outcome variables, decision making reduces to “solving” the system of linear equations with respect to the decision variables; the solution being defined as decision variable values such that maximize the utility function. This paper proposes a family of additively separable utility functions which can be defined by setting four intuitive parameters for each outcome variable: the desired value of the outcome, the lower and the upper limits of its admissible interval, and its importance weight. The utility function takes a nonnegative value within the admissible domain and negative outside; permits gradient methods for maximization; is designed to have a small dynamic range for numerical computation. Small examples are presented to illustrate the proposed method.
Authors and Affiliations
Kiyoshi Yoneda, Walter Celaschi
Keywords
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- EP ID EP167924
- DOI 10.7494/dmms.2013.7.1.5
- Views 88
- Downloads 0
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