ECON 1000 Final: ECONOMICS FINAL EXAM NOTES .docx

• School: York University
• Department: Economics
• Course: ECON 1000
• Professor: All

Document Summary

You can only buy things that you can afford, things that fall under your budget. You will always buy the goods and services that maximize your utility from the many choices you have to choose from. **utility helps us understand why people buy more of a good/service when its price falls and why people buy more of most goods when their income increases. Utility the benefit/satisfaction that a person gets from the consumption of goods and services. Total utility the total benefit a person gets from the consumption of all the different goods and services. More consumption gives more total utility (increase in quantity of good=increase in units of utility) **we can use any scale that we wish to measure the utility. Marginal utility the change in total utility that results from a one unit increase in the quantity of a good consumed.