Utility

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DEFINITION of 'Utility'

1. An economic term referring to the total satisfaction received from consuming a good or service.

2. A company that generates, transmits and/or distributes electricity, water and/or gas from facilities that it owns and/or operates.

INVESTOPEDIA EXPLAINS 'Utility'

1. A consumer's utility is hard to measure. However, we can determine it indirectly with consumer behavior theories, which assume that consumers will strive to maximize their utility. Utility is a concept that was introduced by Daniel Bernoulli. He believed that for the usual person, utility increased with wealth but at a decreasing rate.

2. Since consumer demand for utilities does not change dramatically with a change in price, these companies are regulated by the state or provincial and federal governments.

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  1. How can you find the demand function from the utility function?

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  5. What are the four types of economic utility?

    The four types of economic utility are form, time, place and possession. "Utility" in this context refers to the value, or ... Read Full Answer >>
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    Profits in utilities range dramatically from country to country and region to region. This is partly due to barriers to entry ... Read Full Answer >>
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