Entity: MARGINAL-UTILITY
Marginal-utility refers to the additional satisfaction or benefit a consumer derives from consuming one more unit of a good or service. It is a fundamental concept in economics that helps explain consumer behavior and decision-making.
Marginal-Utility
Etymology
The term 'marginal-utility' originates from mainstream economics and describes the change in utility (pleasure or satisfaction) resulting from the consumption of one additional unit of a good or service.
Definition
Marginal-utility refers to the additional satisfaction or benefit a consumer derives from consuming one more unit of a good or service. It is a fundamental concept in economics that helps explain consumer behavior and decision-making.
Historical Context
The concept of marginal-utility was first introduced by economists to understand how individuals make choices about consuming goods and services. It plays a crucial role in the development of economic theories and models.
Cultural Significance
Marginal-utility has significant cultural significance as it influences consumer preferences, pricing strategies, and resource allocation in various industries. Understanding this concept is essential for businesses to optimize their production and marketing strategies.
Related Concepts
- Utility: The measure of satisfaction or pleasure derived from consuming goods and services.
- Consumer Behavior: The study of how individuals make decisions about what to buy and consume.
See Also
A concept in economics that describes the change in utility (pleasure or satisfaction) resulting from the consumption of one additional unit of a good or service.