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Cardinalism pp 209-221 | Cite as

The Short Step from Ordinal to Cardinal Utility

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Part of the Theory and Decision Library book series (TDLA, volume 19)

Abstract

Let us start with the unrealistic but simple case of a consumer in a two-goods world or, if you prefer, a person whose freedom of choice is limited to allocating a budget between buying two goods. We choose an arbitrary starting point with quantities of the two goods, and by trial and error we find other combinations that the consumer deems equivalent. We can thus construct an approximation of one indifference curve. The process is repeated a number of times with new starting points. We attach numbers to the curves in inverse order of preference. We now have an incomplete ordinal preference function. It does not sound too complicated, but try to actually do it!

Keywords

Marginal Utility Preference Function Utility Theory Indifference Curve Cardinal Utility 
These keywords were added by machine and not by the authors. This process is experimental and the keywords may be updated as the learning algorithm improves.

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© Springer Science+Business Media Dordrecht 1994

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