Net utility is
A)equal to total utility from the quantity acquired of a good minus the utility lost by having to pay for it.
B)equal to the sum of the marginal utilities.
C)equal to an optimal number easily calculated by the consumer.
D)always greater than total utility.

Question

Quizplus · Accepted Answer

Net utility is the total utility gained from acquiring a certain quantity of a good minus the utility lost by having to pay for it. This takes into account the fact that consumers have a limited budget and must make trade-offs between the goods they can afford. Therefore, net utility is not equal to the sum of marginal utilities or an optimal number easily calculated by the consumer, and it can be greater or less than total utility depending on the price paid for the good.

Net Utility Is