Utility concept?

Duche

3 months ago

Utility (in Economics)
Utility is the satisfaction or usefulness a person gets from consuming a good or service.
Simple Definition (for exams)
Utility is the satisfaction derived from the consumption of goods and services.
Explanation
When you eat food, drink water, or use a phone, the benefit or happiness you get is called utility.
It varies from person to person.
Types of Utility
Total Utility (TU)
The total satisfaction from consuming a certain quantity.
Marginal Utility (MU)
The additional satisfaction gained from consuming one more unit.
Example
First bottle of water → very satisfying
Second bottle → less satisfying
Third bottle → even less
(This shows diminishing marginal utility)
Summary
Utility is the usefulness or satisfaction a consumer gets from a product or service.