Question

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

• A. the demand for the good
• B. the money value of the good
• 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 power of satisfying wants. The amount of satisfaction the consumer derives by consuming the commodity is referred as the utility of the product. For example, if a consumer gets 3 utils of satisfaction by consuming a good, then the utility of that good is also 3 utils.