the utility they receive or expect. This concept is similarly used in prospect theory, and many mental accounting theorists adopt that theory as the value function in their analysis. It is important to note that the value function is concave for gains (implying an aversion to risk) and convex for losses (implying a risk-seeking attitude). This can influence the way people evaluate transactions. Given this framework, how do people interpret, or ‘account for’, multiple transactions/outcomes, of the format ? They can either view the outcomes jointly, and receive , in which case the outcomes are integrated, or, in which case we say that the outcomes are segregated. Due to the nature of our value function’s different slopes for gains and losses, our utility is maximized in different ways, depending on how we code the four kinds of transactions and (as gains or as losses): 1) Multiple gains: and are both considered gains. Here, we see that . Thus, we want to segregate multiple gains. 2) Multiple losses: and are both considered losses. Here, we see that . We want to integrate multiple losses. 3) Mixed gain: one of and is a gain and one is a loss, however the gain is the larger of the two. In this case, . Utility is maximized when we integrate a mixed gain. 4) Mixed loss: again, one of and is a gain and one is a loss, however the loss is now significantly larger than the gain. In this case, . Clearly, we don't want to integrate a mixed loss when the less is significantly larger than the gain. This is often referred to as a "silver lining", a reference to the folk maxim "every cloud has a silver lining". When the loss is just barely larger than the gain, integration may be preferred. Clearly, the way in which we perceive two outcomes (how we account for them), can influence how positively (or negatively) we view them. Another very important concept used to understand mental accounting is that of modified utility function. There are two values attached to any transaction - acquisition value and transaction value. Acquisition value is the money that one is ready to part with for physically acquiring some good. Transaction value is the value one attaches to having a good deal. If the price that one is paying is equal to the mental reference price for the good, the