Question

(3 points)

1. describe the meaning of utility in economics and explain why it is different from one consumer to another.

(2 points)

1. why do economists try to measure and understand utility?

Explanation:

In economics, utility refers to the satisfaction or pleasure a consumer derives from consuming a good or service. It varies among consumers due to differences in preferences, tastes, income - levels, and individual circumstances. Economists measure and understand utility to analyze consumer behavior, predict choices, and make market - related decisions. For example, understanding utility helps in setting prices and designing marketing strategies.

Answer:

1. Utility in economics is the satisfaction a consumer gets from consuming goods or services. It differs among consumers because of variations in preferences, tastes, income, and personal situations.
2. Economists try to measure and understand utility to analyze consumer behavior, predict choices, and inform market - related decisions such as pricing and marketing.