Quadratic Utility Function

Evaluate quadratic utility function: U(w) = aw - bw^2 where a, b > 0. Returns utility value, marginal utility (a - 2bw), absolute risk aversion (2b/(a-2bw)), and satiation point (a/2b where marginal utility = 0). Quadratic utility exhibits increasing absolute risk aversion (IARA). Has a bliss point beyond which more wealth decreases utility. Use for mean-variance analysis and portfolio theory. [Tier: STANDARD, Credits: 2]

POST /quantlib/economics/utility/quadratic

Quadratic Utility Function

cURL

curl --request POST \
  --url https://api.fincept.in/quantlib/economics/utility/quadratic \
  --header 'Content-Type: application/json' \
  --header 'X-API-Key: <api-key>' \
  --data '
{
  "a": 1,
  "b": 0.0001,
  "wealth": 1000
}
'

200

{
  "success": true,
  "data": {
    "utility": 900,
    "marginal_utility": 0.8,
    "absolute_risk_aversion": 0.00025,
    "satiation_point": 5000
  }
}

Authorizations

X-API-Key · string · header · required

API key for authentication. Get your key at https://api.fincept.in/auth/register

Body

application/json

a · number · required

Linear coefficient (a > 0)

Required range: x > 0

Example:

1

b · number · required

Quadratic coefficient (b > 0)

Required range: x > 0

Example:

0.0001

wealth · number · required

Current wealth level

Example:

1000

Response

200

application/json

Successful Response

success · boolean

Example:

true

data · object

Show child attributes