We say that a thing is useful or that it has utility when it may be used to gratify a want. Utility, then, means a capacity to gratify a want. Just as we speak of both flour and whiskey as goods because they both serve to gratify wants, so too, we say that both possess utility. The terms good and utility as used in economics refer equally to things that are morally good and to things that are morally bad.

We must not suppose that the utility or want-gratifying capacity of the good is something intrinsic in the good and independent of the consumer of the good. On the contrary, the utility of the good depends upon the wants of the consumer as well as upon the qualities of the good. The utility of the good will be different for different consumers. But it will also be different for the same consumer at different times and under different conditions of supply of the good. For example, apples may be used for a number of purposes. If they are used to satisfy man's need for food directly they are comparatively useful. If they are used to satisfy his need indirectly by being used to feed animals which furnish him food, they are relatively less useful. In the one case they possess much utility and in the other less utility. Or again, if a boy has five apples exactly alike in size and quality and he consumes them one after another, as a general thing the first will gratify a greater want than the second, the second will gratify a greater want than the third; and so on for the five. The first apple consumed has greater utility than the fifth. Simply owing to the fact that it is the first apple consumed, it happens to be used to gratify a keener desire. Perhaps by the time the fifth apple is consumed the boy's appetite has disappeared. He has not cared greatly for the fifth apple. It is clear, therefore, that the utility of the good depends not alone upon the quality of the good but also upon the nature of the want which it happens to gratify and upon the supply of the good.