choice necessitates comparing how costs and benefits change from one option to another. You might think of

marginal analysis as “change analysis.” Marginal analysis is used throughout economics.

We now turn to the notion of utility. People desire goods and services for the satisfaction or utility those goods

and services provide. Utility, as we will see in the chapter on Consumer Choices, is subjective but that does not

make it less real. Economists typically assume that the more of some good one consumes (for example, slices

of pizza), the more utility one obtains. At the same time, the utility a person receives from consuming the first

unit of a good is typically more than the utility received from consuming the fifth or the tenth unit of that same
good. When Alphonso chooses between burgers and bus tickets, for example, the first few bus rides that he

chooses might provide him with a great deal of utility—perhaps they help him get to a job interview or a
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