Determining a Person's Utility of $$

[KUJustin]

This question presented itself to me during an episode of Deal or No Deal that my family was watching.

It seems to me that if we can develop a complete scale of a person's utility of money from a few dollars up to a million we can couple that with an estimate of bank offers for a variety of situations in order to give a correct decision quickly and easily while accounting for the risk-aversiveness of the individual.

So the question is, how would you go about determining a person's individual utility of money? I'm talking practically speaking, what exactly would you do?

Keep in mind that (I'm guessing) the person will likely struggle to accurately answer any preference questions you give them.

I haven't really sat and thought about this but my thoughts up to this point:
1. With enough redundancy of simple preference questions (e.g. would you prefer $50,000 or a 50/50 chance at $200,000) we should be able to overcome much of their inability to accurately compare sums of money.
2. It may benefit us to establish a range of probabilities that we're working with in addition to the built-in range of values (the few dollars to a million dollars). Their preferences on a 1 in 1,000 wager are of little consequence.
3. Using their income, net worth, etc as a factor is a possibility, but it's one that I'm not really comfortable with. Individual personalities are just too strong for this to provide enough valuable data, plus it just seems inelegant.
4. Obviously we would hope to find a utility line that will give us a full scale and also (hopefully) be more accurate than any of the individual situational preferences the person tried to state.

Anyway, if someone really wants to sit down and crunch their head about this I'd be interested in how you'd go about it (EXACTLY what data would you collect, EXACTLY how, EXACTLY what would you do with it?)