This chapter introduces the readers to foundation-level concepts and ideas related to consumers’ choice and its applications to the real world. After reading this chapter and working on the practice questions, the learners should be able to understand the concepts of utility, marginal utility, and the law of diminishing marginal utility; determine the optimal consumption bundle of a consumer; analyze the substitution and income effects of a change in the price of a good or service; construct graphs to show the optimal consumption choice of a consumer graphically and to examine the effects of changes in the price of a good or service or changes in consumer’s income on the optimal choice.