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Utility maximization refers to the concept of consumers making choices in order to maximize their satisfaction or well-being, given their limited resources.
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Marginal Utility: Marginal utility is the additional satisfaction or benefit gained from consuming one more unit of a good or service.
Budget Constraint: A budget constraint represents the limit on consumer choices due to limited income and prices of goods and services.
Indifference Curve: An indifference curve shows different combinations of two goods that provide equal levels of satisfaction for a consumer.