A type of [[Expected value]], where the 'value' is given by an agent's utility function. Instead of using an objective value like money, expected utility optimizes for how useful it will be for the agent in question. If we take insurance as an example, the expected monetary value is usually negative, otherwise insurance firms would have no profit. But a rational person may still buy insurance (because of expected utility) since the money gotten from insurance, after something bad happening, would be worth a lot more to this person (have higher utility) than the money paid for the insurance while everything is good. Expected utility is widely used in [[Decision theory|explaining how rational agents behave under uncertainty]].