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Difference Between Cardinal And Ordinal Utility

Cardinal And Ordinal Utility

Cardinal-ordinal-Economics-study-materials

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DIFFERENCE BETWEEN CARDINAL UTILITY AND ORDINAL UTILITY.

 

Basis Cardinal Utility Ordinal Utility
(1) Meaning It assumes that the satisfaction can be measured & expressed in cardinal i.e. countable numbers. It assumes that satisfaction cannot be measured in numbers but things can be arranged in the order of our preference.
(2) Example Ram yields 60 utils of satisfaction from pizza and 40 utils from a burger. Ram yields more satisfaction from Pizzas in comparison to burger.
 (3) Measurement It says that ‘Utility’ is measured in ‘utils’  It says that ‘Utility’ is rank based on “satisfaction”
 (4) Realistic  It is less realistic.  It is more realistic.
 (5) Used by  This concept was used by Prof. MarshallAlfred Marshall - Economics Study Materials Class 12 This concept was used by Prof. J R HicksJohn R Hicks - Economics Study Materials Class 12
(6) Other Name Utility Analysis  Indifference Curve Analysis