Hi,

I have a question about writing a function for cumulative prospect theory. I have already written the basic function, but i dont know how to express the 'cumulative' part (as graph below). The function needs to consider first weather A1_payoff > A2_payoff.

CPT_V1 <- function (A1_payoff,

A2_payoff,

B1_payoff,

B2_payoff,

A1_prob,

A2_prob,

B1_prob,

B2_prob,

alpha,

epsilon,

lambda,

gamma,

xi){

u <- function(x) {

ifelse(x > 0,

(abs(x)) ^ alpha,

(sign(x)*lambda) * ((abs(x)) ^ alpha))

}

w <- function (x,y){

ifelse(x > 0,

(y^gamma) / (((y ^ gamma) + ((1-y)^gamma)) ^ (1/gamma)),

(y^xi) / (((y ^ xi) + ((1-y)^xi)) ^ (1/xi)))

}

v.A <- w(A1_payoff,A1_prob) * u(A1_payoff) + w(A2_payoff,A2_prob) * u(A2_payoff)

v.B <- w(B1_payoff,B1_prob) * u(B1_payoff) + w(B1_payoff,B1_prob) * u(B2_payoff)

v.diff <- v.A-v.B

}