What is Utility Analysis?
Consumers are the ones who make the majority of consumption decisions. A consumer is someone who buys goods and services to fulfil demands. He makes choices about the kinds of items to be bought to fulfil his desires. The primary goal is to maximise satisfaction from the goods and services he purchases with his income. To achieve the highest level of satisfaction, a consumer must follow certain rules or principles since resources are limited in nature in comparison to limitless demands. The two basic approaches for studying customer behaviour are the Cardinal Utility approach and Ordinal Utility Approach.
Table of Content
- What is Cardinal Utility Approach?
- What is Utility?
- How to measure Utility?
- Basic Limitation of Utility Analysis
- What is Ordinal Utility Approach?
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