![]() Marginal utility is calculated as “Change In Total Utility” / “Change In Units” ![]() Marginal utility is the change in the consumer’s willingness to spend when new goods or services are presented. Utility measures a consumer’s willingness to spend. ![]() This will be based on the amount of income a consumer has, their budgetary constraints, their needs, their wants, and their personal preferences. Utility plays a key role in consumer theory, which is the study of how a consumer decides to spend their money. This value is known as “utility.” It is the satisfaction or happiness a consumer gets from a good or service. When consumers pay for a good or service, they place a certain value on what it provides for them.
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June 2023
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