 So we have to consider how much various dollar-amounts are worth to you. Losing $10 is worth about the same to you as losing $0, though gaining $19 is much, much more valuable. To capture these facts, we introduce a function, \(u\), which represents the utility of various possible outcomes. For you, \(u(-$10) \approx u(-$0)\), but \(u(+$19) \gg u(-$0)\).