Economics is concerned with consumer behavior, the behavior that people seek to acquire goods and services that will satisfy there needs and wants. Therefore, they can t afford to satisfy all of their needs. Consumers wants are broad.
Consumers behave rationally and efficiently in maximizing their own satisfaction.
There are two ways to analyze consumer behavior Marginal utility approach Indifference curve approach. They both explain why changes in prices and income have predictable effects on consumer behavior. Utility is the benefit you get from consuming goods and services you buy. Utility from a good is whatever pleasure, or happiness you get from it. Utility depends on individuals tastes and preferences.