Difference between revisions of "Utility"
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(added other meaning) |
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*as a provider of electricity, gas or telephone service | *as a provider of electricity, gas or telephone service | ||
| − | Utility is an economic term representing | + | Utility is an economic term representing someone's satisfaction or happiness. The utility of a [[good]], for example, is its ability to bring satisfaction to the buyer. |
Utility functions are mathematical ways of representing the benefits accruing to a consumer from his consumption of various goods. A utility function, in conjunction with a budget constraint, may be used to determine a consumer's optimal bundle of goods. | Utility functions are mathematical ways of representing the benefits accruing to a consumer from his consumption of various goods. A utility function, in conjunction with a budget constraint, may be used to determine a consumer's optimal bundle of goods. | ||
| − | The term utility has its origins in | + | The term utility has its origins in [[utilitarianism]], a philosophical school of thought in ethics. |
[[Category:Economics]] | [[Category:Economics]] | ||
[[Category:Philosophy]] | [[Category:Philosophy]] | ||
Revision as of 04:40, April 10, 2010
Utility has two primary meanings:
- as a concept in economics (see below)
- as a provider of electricity, gas or telephone service
Utility is an economic term representing someone's satisfaction or happiness. The utility of a good, for example, is its ability to bring satisfaction to the buyer.
Utility functions are mathematical ways of representing the benefits accruing to a consumer from his consumption of various goods. A utility function, in conjunction with a budget constraint, may be used to determine a consumer's optimal bundle of goods.
The term utility has its origins in utilitarianism, a philosophical school of thought in ethics.