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Utility :
 
The goods satisfy human wants. This want satisfying quality in a good is called Utility. Utility is that quality in a commodity by virtue of which it is capable of satisfying a human want. Air, water (free goods) and food, cloth etc. (economic goods) satisfies people’s wants and hence they possess utility.

In day to day life we use this term in different way but in Economics utility is having a specific meaning.

Types of Utility:
1. From Utility: Due to change in form there is change in utility, e.g. Wood when transformed into furniture, utility will increase.
2. Place utility: When goods transported from one place to another place utility can increase. For example apple will fetch more prices in other part of country than in Kashmir and Himachal Pradesh.
3. Time utility: By storing a commodity and selling it at a time of scarcity, utility can be realized more.