In other to enhance the utility of a particular commodity, it was moved from a place where it has little…

Step 1: Analyze the question A commodity is moved from a place where it has little utility to another place where it has more utility. The key idea is movement from one location to another.

Step 2: Explain the concept Utility is the satisfaction or usefulness a good gives to a consumer. Economists identify different forms of utility:

• Form utility: created when raw materials are changed into a finished product (e.g., cocoa beans made into chocolate).
• Place utility: created when goods are moved to where they are needed (e.g., transporting tomatoes from Kano to Lagos).
• Time utility: created when goods are made available at the time they are needed (e.g., storing umbrellas for the rainy season).
• Possession utility: created when ownership passes to the consumer (e.g., through buying and selling).

Other options in the question are different ideas:

• Marginal utility is the extra satisfaction from consuming one more unit of a good.
• Total utility is the overall satisfaction from consuming all units of a good.

Step 3: Solve

• The commodity was moved from one location to another, so the change is about location.
• It was not changed in shape or composition, so it is not form utility.
• Marginal and total utility measure satisfaction from consumption and have nothing to do with moving goods.

The utility created by moving goods to a more suitable location is place utility.

Step 4: Answer C. Place utility

Tip: Match the keyword in the question to the type of utility:

• Moved or transported means Place
• Changed or manufactured means Form
• Stored or delayed means Time
• Transferred ownership means Possession

Well done for working through it step by step, and keep practising!