Answer to Question #323738 in Economics for Lina

Question

5. Using the example of your favourite soft drink, explain how your demand for it can be derived from the utility you receive from its consumption.

Answer 1

Marginal utility is the enjoyment a consumer gets from each additional unit of consumption. It calculates the utility beyond the first product consumed. If you buy a bottle of soft drink and then a second one, the utility gained from the second bottle of soft drink is the marginal utility.