Utility: The satisfaction people derive from consumption activity is known as utility.
There are two types of utility:
a. Cardinal utility
b. Ordinal utility
A. Cardinal utility: cardinal utility can be quantified and it assigns no.
Cardinal utility is associated with RATINGS.
Ex: imagine you watched a movie and someone asked you how much you enjoyed that particular movie? You cannot answer it untill a particular scale is given to you. So in that case you can rate the movie but u can not say how much you enjoyed like 10 or 100 .
B. Ordinal utility: Ordinal utility is associated with RANKING.
Ordinal utility offers independent data and it doesn't depend on cardinal utility.
Ex: Top ten B-schools
Top ten sports
Top ten songs etc.
So, here we can see the major difference between cardinal utility and ordinal utility.
Or, satisfaction derive from hobbies, is known as utility.
There are two types of utility:
a. Cardinal utility
b. Ordinal utility
A. Cardinal utility: cardinal utility can be quantified and it assigns no.
Cardinal utility is associated with RATINGS.
Ex: imagine you watched a movie and someone asked you how much you enjoyed that particular movie? You cannot answer it untill a particular scale is given to you. So in that case you can rate the movie but u can not say how much you enjoyed like 10 or 100 .
B. Ordinal utility: Ordinal utility is associated with RANKING.
Ordinal utility offers independent data and it doesn't depend on cardinal utility.
Ex: Top ten B-schools
Top ten sports
Top ten songs etc.
So, here we can see the major difference between cardinal utility and ordinal utility.
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