Answer on Other Economics Question for parashar
Explain the consumer’s equilibrium in terms Marshallian Law of equi-marginal utility. Give
illustrations in support of your answer.
The concept of Cardinal Utility was used by Marshal to define Consumer's Equlibrium. Cardinal Utility means the consumer could measure the satisfaction derived by the consumption of any goods or services in terms of number and unit of that measurment is Utils or the Money.
Whereas Ordinal Utility means giving the rank to the utility dervied by the consimption of goods and services. This Concept was given by J.R. Hicks. This is more realstic and better than cardinal utility. This is totally based on Introspection.
The ordinal utility emphasizes ordering/rank bundles of goods.
The cardinal utility emphasizes the size of the difference between two bundles of goods.
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