Utility is the satisfaction that we get from consuming an item. Marginal utility is the additional satisfaction we get from consuming one more (additional) item. The theory of diminishing marginal utility states that as we consume more of a product, marginal utility will decrease, i.e. the first unit consumed will yield more satisfaction than the second which will yield more satisfaction than the third.... and so on. Rational consumers will seek to maximise their total utility.
Economic theories are based on rational economic decision-making, i.e. economic decision-makers will act in their best self-interest. We assume that consumers will seek to spend their money in such a way as to maximise their total utility. Producers will seek to maximise their profits. The thing is, people are not always rational!
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