Concept of Utility – Average, Marginal And Total Utility - SS2 Economics Past Questions and Answers - page 1
1
What does utility refer to in economics?
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A
The satisfaction or happiness that a consumer derives from consuming a particular good or service.
B
The cost of producing a particular good or service.
C
The price of a particular good or service in the market.
2
What is average utility?
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A
The additional satisfaction or happiness that a consumer gets from consuming one additional unit of a good or service.
B
The overall satisfaction or happiness that a consumer gets from consuming a particular quantity of a good or service.
C
The total utility derived from consuming a good or service divided by the quantity of the good or service consumed.
3
What is marginal utility?
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A
The total satisfaction or happiness that a consumer gets from consuming a particular quantity of a good or service.
B
The additional satisfaction or happiness that a consumer gets from consuming one additional unit of a good or service.
C
The average level of satisfaction or happiness that a consumer derives from each unit of the good or service.
4
What is total utility?
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A
The overall satisfaction or happiness that a consumer gets from consuming a particular quantity of a good or service.
B
The total cost of producing a particular good or service.
C
The price of a particular good or service in the market.
5
What happens to marginal utility as a consumer consumes more units of a good or service?
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A
It stays the same.
B
It increases.
C
It diminishes.
6
Why is it important to understand the concept of utility in economics?
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7
When might it not be worth it for a consumer to consume more units of a good or service?
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