Question

Marginal utility analysis of consumer equilibrium assumes that utility can be expressed in terms of cardinal numbers which is a serious limitation of utility analysis.

• A. True
• B. False

Answer 1

The correct option is A True

In cardinal utility analysis, utility can be measured in terms of cardinal numbers i.e. 1,2,3,4, etc. which is very irrational on the part of consumer to act that way. As while buying a commodity a consumer does not measures his utility in cardinal numbers, they just measure it has high or low.