Assumptions of cardinal utility analysis – Microeconomics | Management Notes

Assumptions of cardinal utility analysis
Cardinal Utility Approach | Microeconomics
Management Notes


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.

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