What is total utility?
The total amount of happiness or benefit that a consumer gets from using a certain good or service is called total utility. Total utility is often contrasted with marginal utility, which is the benefit a consumer gets from using one more unit of a good or service. Total utility helps economists analyze the demand for goods and services.
Total utility Explained
Total utility is the total amount of satisfaction or fulfillment that a person gets from consuming a certain good or service. Another type of utility is marginal utility, which is the extra satisfaction a person gets from consuming one more unit of a good or service.
Total utility measures how happy or satisfied people are from consuming different products or services. It is related to consumer behavior in a market. Economists have special methods to calculate the total utility of a product or service.
Total utility affects the market's supply and demand of products and services. Economists use different tools to study supply and demand by looking at the total utility of products and services.
Economists also examine how consumer behavior changes when there are small increases or decreases in consumption. For total utility, these small changes mean the increasing or decreasing levels of satisfaction that people get from consuming more or less.
Total utility is often contrasted with marginal utility, which is another way of measuring satisfaction from consumption. Total utility is the sum of all the marginal utilities until the last unit is consumed