define utility. give the relationship between total utility and marginal utility. is utility measurable
Answers
Answer:
the state of being useful, profitable, or beneficial.
Marginal utility is the addition made to total utility by having an additional unit of the commodity. ... So long as total utility is increasing, marginal utility is decreasing up to the 4th unit. When total utility is maximum at the 5th unit, marginal utility is zero. It is the point of satiety for the consumer.
In practice, a consumer's utility is impossible to measure and quantify. However, some economists believe that they can indirectly estimate what is the utility for an economic good or service by employing various models
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Answer:
Utility is a term in economics that refers to the total satisfaction received from consuming a good or service.
Total utility is the total satisfaction received from consuming a given total quantity of a good or service.
Marginal utility is the added satisfaction that a consumer gets from having one more unit of a good or service.
Utility is cardinally Measurable: It is assumed that the utility is measurable, and the utility derived from one unit of the commodity is equal to the amount of money, which a consumer is ready to pay for it, i.e. 1 Util = 1 unit of money.