Consumer Theory

Consumer theory is a branch of microeconomics that studies the variables that affect purchasing decisions. It covers factors such as budget constraints, utility, and product choice – looking at how these affect the final consumers decision making.

Giffen Good

Giffen Good

A Giffen good is an unusual type of inferior good in which an increase in price leads to an increase in quantity demanded, contradicting the typical inverse relationship between price and demand.

Indifference Curve

An indifference curve is a graphical representation that shows different combinations of two goods, each providing the same level of satisfaction or utility to an individual.

Utility Maximization Definition

Utility Maximization: Definition, Example & Limitations

Table of Contents What is Utility Maximization Utility Maximization Rule Utility Maximization Example Limitations of Utility Maximisation Utility Maximization FAQs Utility Maximization: Definition, Example & Limitations Written by Paul Boyce Posted in Microeconomics > Consumer Theory Last Updated February 9, 2023 What is Utility Maximization Utility maximisation is the concept that consumers and businesses seek