Which term refers to the additional satisfaction gained from consuming an additional unit of a good or service?

The term that refers to the additional satisfaction gained from consuming an additional unit of a good or service is known as Marginal Utility. This concept is fundamental in economics as it helps to explain consumer behavior. Marginal Utility captures the change in utility, or satisfaction, that a consumer experiences as they increase their consumption of a good or service by one unit.

As consumers consume more of a good, the satisfaction derived from each additional unit often changes, typically diminishing after a certain point; this is known as the Law of Diminishing Marginal Utility. Understanding Marginal Utility is crucial for analyzing how consumers make decisions on purchasing and consuming goods and services, as it directly influences their willingness to pay for additional units.

In contrast, Average Utility, Consumer Surplus, and Total Utility refer to different aspects of consumer satisfaction and economic value. Average Utility signifies the overall satisfaction averaged across all units consumed, while Total Utility represents the complete satisfaction from consuming all units of a good. Consumer Surplus measures the difference between what consumers are willing to pay and what they actually pay. Each of these terms provides valuable insight into consumer behavior but does not specifically address the incremental satisfaction associated with an additional unit like Marginal Utility does.