Assumptions of cardinal utility analysis
Cardinal Utility Approach | Microeconomics
Cardinal Utility approach is the method of analyzing utility which believes that utility is a quantitative concept i.e, utility can be measured numerically .Its unit of measurement is Utils.The assumptions of cardinal utility analysis are as follows:
- The consumer is rational.
- Utility can be measured in cardinal number.
- Marginal utility of money remains constant.
- Units of consumption are suitable.