Monday, September 26, 2016

Cardinal utility VS Ordinal utility


Cardinal Utility
Ordinal Utility
1.Cardinal utility states that the satisfaction that the consumer derives by consuming goods and services can be measured with numbers.
1. Ordinal utility states that the satisfaction that the consumer derives from the consumption of goods and services cannot be measured in numbers
2. Cardinal utility is a quantitative measure
2. Ordinal utility is a qualitative measure.
3. In cardinal utility, it is assumed that consumers derive satisfaction through consumption of one good at a time.
3. in ordinal utility it is assumed that a consumer may derive satisfaction from the consumption of a combination of goods and services
4. Using Cardinal utility a customer can assign a number to a product that when consumed was able to satisfy their needs.
4. Using ordinal utility a customer can rank the products according to the level of satisfaction that was derived.
5. Cardinal utility is a quantitative method that is used to measure consumption satisfaction.
5. Ordinal utility is a qualitative method that is used to measure consumption satisfaction.