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The optimum consumer

The goal of rational consumer is to maximize its usefulness in its budget constraint. Suppose that consumes an amount Electricity x1 x2 and a quantity of other goods, the problem can be written as:

The budget constraint or budget line defines a line in the plane (x1, x2). Solving this program yields the optimal quantities of electricity x * 1 x * 2 and other goods that maximize consumer utility.
Graphically, this optimum can be characterized as follows:

This figure characterizes the optimum of the consumer. The utility is maximized point of tangency of the curve and the budget line. The pair (x * 1, x * 2) represents this optimum. It also shows that the increase in electricity consumption would automatically lead to reduced consumption of other goods, so that the budget constraint is saturated.

This defines the demand function of a property. The figure below shows the demand function of good X1.

function of electricity demand expresses the optimal choice of the consumer depending on the price of electricity and how much income it provides. The demand curve is an inverse relationship between the quantity of electricity consumed and its price.