Consumer Goods: Definition, Types & Examples
A consumer good, also known as a ‘final good’, is the end product a business produces and is purchased by the consumer.
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.
Utility Maximization: Definition, Limitations & Example
Table of Contents What is Utility Maximization Utility Maximization Rule Utility Maximization Example Limitations of Utility Maximisation Utility Maximization FAQs Utility Maximization: Definition, Limitations & Example 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
Price Gouging: Definition, Is it Bad, Causes & Examples
Price gouging is where the seller increases the prices of their goods or services to a level considered unreasonable and unfair.
Substitute Goods: Definition, Types & Examples
A substitute good is a product or service that is used in place of another.
Complementary Goods: Definition & Examples
A Complementary good is a product or service that adds value to another. In other words, two goods that the consumer uses together. For example, cereal and milk, or a DVD and a DVD player.
Income Effect: Definition, Graph & Examples
Where changes in income, affect the demand for goods. As incomes rise, demand tends to rise. As incomes fall, demand tends to fall.
Marginal Utility: Definition, Formula & Examples
Marginal Utility is the enjoyment or satisfaction that a consumer gains for each additional unit they consume. So it calculates the utility beyond the first product or service consumed (the marginal amount).
Substitution Effect: Definition & Example
The substitution effect occurs when consumers switch to substitute goods as prices rise. For example, if the price of chicken increases, then consumers may start to switch to substitute goods such as beef or pork.
