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One of the Key Concepts Involved in the Circular Flow

question 304

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One of the key concepts involved in the circular flow diagram is that


Definitions:

Total Utility

The overall satisfaction or happiness received from consuming a certain amount of goods or services.

Marginal Utility

The extra pleasure or benefit obtained from consuming an additional unit of a product or service.

Total Utility

The total satisfaction or benefit that a consumer derives from consuming a certain quantity of goods and services.

Marginal Utility

The change in total satisfaction or pleasure derived from consuming one more unit of a good or service.

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