Question

When economists speak of the utility of a certain good, they are referring to:

• A. The demand for the good.
• B. The usefulness of the good in consumption.
• C. The satisfaction gained from consuming the good.
• D. The rate at which consumers are willing to exchange one good for another.

Answer 1

Answer: (C)

The satisfaction gained from consuming the good.

Utility refers to the want satisfying power of a commodity that the consumer strives for in the commodity. So it is the satisfaction level which the consumer gets of consuming the commodity which he needs among various alternatives.