Question

What do you understand by Total Utility?

Hint:

Total Utility increases with consumption, but it experiences diminishing returns as more units are consumed.

Answer 1

Total Utility refers to the total satisfaction or pleasure derived from consuming a given quantity of goods or services. It is the sum of marginal utilities of each additional unit consumed. As consumption increases, total utility increases, but at a diminishing rate due to the law of diminishing marginal utility. The concept helps explain consumer behavior and how choices are made to maximize satisfaction. It plays a central role in understanding demand in microeconomics.