Economics Lecture Notes on Utility and Price Discrimination

These flashcards cover key concepts related to utility, consumer behavior, and price discrimination to aid exam preparation.

Utility

A measure of satisfaction or pleasure derived from consuming a good or service.

Marginal Utility (MU)

The additional satisfaction gained from consuming one more unit of a good or service.

Price Discrimination

The practice of charging different prices to different consumers for the same good or service, based on their willingness to pay.

Budget Constraint

The limit on the consumption bundles that a consumer can afford.

Optimal Consumption Rule

A principle that consumers maximize their utility when the ratio of the marginal utility to the price of each good is equal.

Satisfaction

A state of contentment or fulfillment derived from consuming goods or services.

Consumer Behavior

The study of how individuals make decisions to spend their resources on consumption-related items.

Total Utility

The total amount of satisfaction received from consuming a particular quantity of goods or services.

Price Comparison

The process of comparing prices of products to determine the best value for money.

Consumer Surplus

The difference between what consumers are willing to pay for a good or service versus what they actually pay.