Utility is a measure of how much satisfaction or use a consumer receives from a good or service. As you might imagine, there isn’t really a way to put a number on satisfaction or use, since both are fairly subjective. However, that doesn’t stop economists from trying to do so.
For example, let’s say you buy a car with a sunroof. Your friend buys the same exact car without a sunroof but pays $500 less. Economists will say that you received $500 of utility from the more expensive car. In other words, you received a specific amount of satisfaction for the additional cost.
Another form of utility is a company that provides a public service such as electricity or water.
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