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When is total utility maximized?

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Quick Answer

Total utility is maximized when consumers find a combination of goods and services that provides the most use and satisfaction for the money spent. The pursuit of total utility is an ongoing process for consumers who seek to maximize satisfaction despite limited financial resources to buy new goods and services.

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Full Answer

A part of the total utility theory is the law of diminishing marginal utility, which explains that customers are less satisfied with products or services as they purchase them over time. This is what drives consumers to try new vendors and new services: they seek to achieve the total utility they felt the first time they purchased something similar.

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