Course: Microeconomic - Consumer Theory Explain in detail and model theoretically (be clear about it) establishing the assumptions considered necessary. Considering an individual who will choose 2 goods (X1 and X2) perfect substitutes: (a) How the individual analyzes his preferences and economic constraints (include the respective slopes in the analysis). b) How the individual constructs his demand function. Derive graphically and analyze the individual's demand for a rise in the price of good X1. Attach in each case the respective graphs.

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Form Utility

The term utility in general refers to the satisfaction earned from usage of a particular product or service. Utility always plays an important role because it influences various important elements like demand & thereby the price of the good or service as well. Though utility is not easy to measure, various types of economic models can be used indirectly. There can be various types of utilities like economic utility, marginal utility, cardinal utility, form utility.