The term utility maximization means that
A)individuals consume to gain as much utility as possible, given the limits of the budget constraint.
B)total utility does not change with a change in income.
C)once utility is at its maximum, leftover income can be saved.
D)individuals consume the maximum amount of a good that the budget constraint makes possible.
E)individuals maximize their usefulness to society.

Question

Quizplus · Accepted Answer

Utility maximization means that individuals consume in a way that results in the highest level of utility, or satisfaction, given their budget constraint. This is achieved by allocating their limited resources, such as income or time, in a way that maximizes the total satisfaction or usefulness received from the consumption of goods and services. Therefore, choice A is the correct answer.

The Term Utility Maximization Means That