Economics-Chapter-10 - Economics:Chapter10 13:07:00...

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Economics: Chapter 10 22/10/2007 13:07:00 Utility:  Measure of the satisfaction the consumer derives from consumption of  goods and services. Utility and Consumption An individuals utility depends on everything that individual consumes. Consumption Bundles:  The collection of all the goods and services  consumed by that individual. Utility Function:  Gives the total utility generated by someone’s consumption  bundle. (how Happy they are) Util:  unit of utility Marginal Utility Marginal utility  of a good or service is the change in total utility generated  by consuming one additional unit of that good or service. Marginal utility curve:  Shows how marginal utility depends on the  quantity of a good or service consumed. Downward sloping. Principle of diminishing marginal utility:  Says that each successive  unit of a good or service consumed adds less to total utility than the 
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This note was uploaded on 01/16/2012 for the course ECON 2000 taught by Professor Roussell during the Fall '06 term at LSU.

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Economics-Chapter-10 - Economics:Chapter10 13:07:00...

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