Question

what os marginal utility

Answer 1

Heya .....

Marginal Utility ( MU) --- The additional Utility derived from the consumption of every additional unit of a commodity...

Formula.... TUn - TUn-1

Answer 2

The theory behind utility is simple. A certain amount of satisfaction, value, or benefit is gained when a good or service is consumed. As David consumes each slice of pizza, he experiences satisfaction. Similarly, an employee working on a project can feel a certain amount of value is added to the project based on the number of hours spent working on the project. An athlete assigns a certain amount of benefit to the amount of time spent training. The total amount of satisfaction, value, or benefit gained from the consumption of each good or service is the total utility. Let's look back at David and his pizza.

As the excitement of eating pizza increases, the total utility from the consumption of one slice of pizza rises from 7 to a total utility of 12 by the consumption of the third slice. However, the total utility decreases to 5 by the time the fifth slice of pizza is consumed, as David starts to feel full. The variance in total utility as each slice of pizza is consumed is called the marginal utility.

Marginal Utility Formula

Marginal Utility = Change in total utility / Change in number of units consumed