In your own words, what is utility? Can utility be measured? Can you measure your own utility? Can...

Question

In your own words, what is utility? Can utility be measured? Can you measure your own
utility? Can someone else measure your utility? Why or why not? Can social welfare be
measured by “adding up” peoples’ utilities? Why or why not? If not by using utility, how
can policy makers estimate the welfare of government policies?

in-your-own-words-what-is-utility-2zbusetc.pdf

Komalavalli · Accepted Answer

Utility:
Utility is the amount of satisfaction that we derived from consuming goods. This utility in general measured by units which is known as utilis. Utility cannot be measured directly either by myself or someone else. The only we can measure utility using revealed preference approach I can measure my utility by using the amount that I willing to pay for the purchase of particular good. Someone else can measure my utility only when they know my willingness to pay for particular good. They can’t measure my utility if they don’t know about my willingness to pay.

In your own words, what is utility? Can utility be measured? Can you measure your own utility? Can someone else measure your utility? Why or why not? Can social welfare be measured by “adding up”...

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