Or for a company, this translates to
Alternatively
In economic theory a rational entity (a person or people running company) will estimate the utility of something, and this will be closely reflected in how much they are willing to give up to get it - eg how much they are willing to pay for it.
A decision process typically is trying to maximize something - profit for the company, the probability of winning a competition, the hours of leisure, the amount of alcohol consumed and so on. Utility is just the name given to the entity which is to be maximized. Sometimes an entity is trying to maximize many things which involve a trade-off (eg the amount of income, and the leisure time), and utility is the entity which describes the trade-off ratios.
In business, utility can be measured to some degree by how much an entity is willing to pay for something. For instance, a bulldozer goes up for auction. A number of competing businesses might bid for it. Each business manager will estimate how much money they can make by owning the bulldozer (when risks, running costs, maintenance, effort etc are taken into account) and bid up to that amount. Clearly they won't bid any higher - that would simply lose money. So the utility they get from owning the bulldozer is pretty much what the winner bid for it (or for the runner-up where they stopped bidding for it).
In personal life, the same principle applies, but it's a bit more complex. Suppose Fred Smith buys a new TV for $1000.00. He probably knows the benefits and costs of buying and then owning the television, and he knowingly spent that $1000.00 of his money on buying it. He could have bought many other things with his $1000.00 - meals at fancy restaurants, some new furniture, lots of loaves of bread, some new clothes, or combinations of these things. But he bought the TV.
This means that he judged that the TV would give him more utility than anything else he could have bought with that $1000.00.
Whereas we can measure the business' absolute utility from something, we can only measure the private citizen's relative utility compare to other things.
Forced Redistribution
These thought experiments suggest that we should be very cautious about governments redistributing business according their assessment of 'need' or 'business benefit'. When you take a commercial good away from someone who would have won the auction and give it to someone who would not have, you give it to someone who (by their own judgement) will get less commercial benefit from it than the auction winner.
This in turn gives a powerful insight into the failure of command economies. The idea that a government bureaucrat will make better decisions about distribution of the tools of production than the companies themselves would be laughable if fewer people actually believed it.
See