The Most Important Types of Utility are listed below:
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(a) Form utility:
Form utility is created by changing the shape of the object. Here the shape changes and the utility of a commodity (or object) also changes. With the passage of time and change in knowledge people changed things to their needs.
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Now-a-days, we find many processing industries in operation for re-arranging, shaping and reshaping things for increasing utility. A suitable example can be given here in this connection. A carpenter can make chair, table etc. from a log of wood and making so form utility is created.
(b) Time utility:
Usually with the change in time, the utility of a commodity changes. For example, rice, wheat and other food grains are prettily available in the harvest time. So the utility of such commodities is low during the harvesting period. So people store them for the period of scarcity.
In the village areas the households store and preserve food grains for the rainy season. By doing so, they sell food grains at a higher price in the rainy season and gain on two accounts.
1. With the change in time people can meet scarcity and the utility of commodities stored and preserved also increases.
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2. When commodities are carried over from the period of plenty to period of scarcity, not only the utility of such commodities increases but also addition to their value occurs. Due to value addition, the commodities are sold at a higher price and people get more income.
So additional utility is created by storing and preserving the commodities from the period of plenty to the period of scarcity. This additional utility created is called time utility.
(c) Place utility:
With the change in place and space, the utility of a commodity changes. We have seen cases and we can cite examples where the change of place has improved the utility. Water in rural areas is prettily available as a free good.
It has least utility in rural areas while the utility of water is very high in towns and cities. Similarly for tribal people wood has least utility because they are encircled with woods. But the same wood when comes to cities, it has high utility and it is sold at a very high price.
(d) Service utility:
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The things which I cannot do for myself by my own efforts, then I cannot satisfy my wants by my own efforts. In that case, I must seek the services of others like the services of a teacher, lawyers, doctors, nurses, barbers, poters, blacksmith, driver, artists, musicians, etc. The services of such people create additional utility. By selling their personal services, they satisfy our wants and improve the utility of a commodity.