Which of the following statements is true of utility?
A)It is possible to precisely measure the utility an individual receives from consuming a particular good or service.
B)It is always possible to determine whether Darlene or Julie gets more utility from consuming two units of the same good.
C)The utility of goods can be measured, while that of services cannot.
D)Utility is a subjective measure of satisfaction an individual receives from consuming a good or service.
E)The concept of utility is useful only if there is no scarcity.

Question

Quizplus · Accepted Answer

Utility is a subjective measure of satisfaction an individual receives from consuming a good or service. It is not possible to precisely measure the utility an individual receives since it is based on personal preferences and experiences. It is also not always possible to determine who gets more utility from consuming the same good since it varies among individuals. The concept of utility is applicable even in situations of scarcity since it is used to make choices between different goods or services based on the satisfaction they provide.

Which of the Following Statements Is True of Utility