In the context of consumer choice theory, what does "utility" refer to?

Utility in consumer choice theory refers to the satisfaction or pleasure that a consumer derives from consuming goods and services. It is a central concept in economics that helps explain how consumers make choices based on the perceived happiness they expect to gain from their consumption. When individuals consider what to purchase, they do so with the intention of maximizing their utility, which influences their preferences and behavior in the marketplace.

Understanding utility enables economists to analyze consumer behavior, as it highlights the idea that consumers are rational beings who seek to achieve the highest level of satisfaction with their limited resources. The measure of utility varies among individuals and can change based on personal tastes, circumstances, and the availability of goods and services. Thus, option B correctly captures the essence of utility as it relates to consumer choices in the economy.