[amp_mcq option1=”measures the utilities in precise manner though they are immeasurable” option2=”is relative to the level of utilities only” option3=”is the basis of the ‘Revealed Preference Curve'” option4=”is the basis of indifference curve analysis” correct=”option4″]<\/p>\n
The correct answer is D.<\/p>\n
Cardinal utility is a concept in economics that measures the satisfaction or pleasure that a consumer receives from consuming a good or service. It is often represented by a utility function, which is a mathematical equation that shows how a consumer’s utility changes as they consume more of a good or service.<\/p>\n
Indifference curve analysis is a tool used in economics to analyze consumer behavior. It shows the combinations of goods and services that a consumer is indifferent between. In other words, it shows all the combinations of goods and services that provide the consumer with the same level of satisfaction.<\/p>\n
The cardinal utility made by Marshall is the basis of indifference curve analysis. This is because the utility function can be used to derive indifference curves. Indifference curves are used to show the consumer’s preferences for different goods and services. They can also be used to determine the consumer’s optimal consumption bundle.<\/p>\n
The other options are incorrect.<\/p>\n
Option A is incorrect because cardinal utility is not measurable. It is a subjective measure of satisfaction that cannot be quantified.<\/p>\n
Option B is incorrect because cardinal utility is not relative to the level of utilities only. It is a measure of the satisfaction that a consumer receives from consuming a good or service.<\/p>\n
Option C is incorrect because cardinal utility is not the basis of the ‘Revealed Preference Curve’. The revealed preference curve is a tool used in economics to analyze consumer behavior. It shows the combinations of goods and services that a consumer actually chooses to consume.<\/p>\n
I hope this helps!<\/p>\n","protected":false},"excerpt":{"rendered":"
[amp_mcq option1=”measures the utilities in precise manner though they are immeasurable” option2=”is relative to the level of utilities only” option3=”is the basis of the ‘Revealed Preference Curve’” option4=”is the basis of indifference curve analysis” correct=”option4″]<\/p>\n","protected":false},"author":1,"featured_media":0,"comment_status":"closed","ping_status":"open","sticky":false,"template":"","format":"standard","meta":{"footnotes":""},"categories":[12],"tags":[],"class_list":["post-43218","post","type-post","status-publish","format-standard","hentry","category-economics","no-featured-image-padding"],"yoast_head":"\n