Overview
Marginal utility is a key concept in economics that helps explain how consumers make choices based on the additional satisfaction they receive from consuming goods and services. Understanding marginal utility allows individuals to make informed decisions about their consumption, balancing their pref...
Key Terms
Example: Eating a slice of pizza provides utility.
Example: The satisfaction from eating one more slice of pizza.
Example: Total utility from eating three slices of pizza.
Example: The first slice of pizza is more satisfying than the fourth.
Example: Choosing between pizza and burgers based on preference.
Example: A budget of $20 limits how much pizza and soda can be bought.
Related Topics
Key Concepts
UtilityDiminishing Marginal UtilityConsumer ChoiceBudget Constraint