1. What is Total Utility?

Total Utility (TU) represents the total satisfaction or benefit derived from consuming a certain quantity of goods or services. It is calculated by summing the marginal utilities of each unit consumed.

2. How Does the Calculator Work?

The calculator uses the formula:

Where:

• \( TU \) — Total Utility
• \( \sum \) — Summation symbol
• \( MU \) — Marginal Utility of each unit

Explanation: The calculator sums up all the marginal utility values provided for each unit to calculate the total utility.

3. Importance of Utility Calculation

Details: Understanding total utility helps in analyzing consumer behavior, making optimal consumption decisions, and studying economic efficiency in market systems.

4. Using the Calculator

Tips: Enter the number of units consumed, then provide the marginal utility for each unit. All values must be valid numerical inputs.

5. Frequently Asked Questions (FAQ)

Q1: What is the difference between total utility and marginal utility?
A: Total utility is the overall satisfaction from consuming all units, while marginal utility is the additional satisfaction from consuming one more unit.

Q2: Can total utility decrease?
A: Yes, when marginal utility becomes negative (disutility), total utility can decrease with additional consumption.

Q3: What is the law of diminishing marginal utility?
A: It states that as consumption increases, the marginal utility derived from each additional unit tends to decrease.

Q4: How is utility measured?
A: Utility is typically measured in arbitrary "utils" as it represents subjective satisfaction that cannot be directly quantified.

Q5: What are some practical applications of utility theory?
A: Utility theory is used in consumer choice modeling, demand analysis, welfare economics, and behavioral economics studies.