UTILITY ANALYSIS

UTILITY:
          The want satisfying power of a commodity is termed as a utility. Utility is an subjective or psychological concept. Utility is ethically neutral.


TYPES:

         There are four types of utility. They are:
            1. Place utility
            2. Time utility
            3. Form utility
            4. Service utility

There are 2 utility aspects. They are:

            1. CARDINAL UTILITY:
                         This analysis is given by Prof. Marshall which means utility can be measured in cardinal numbers like 1,2,3,4,5,6,7,_ _ _ _ etc. There are 3 concepts under cardinal utility. They are:
           
            1. Law of D.M.U
            2. Law of E.M.U
            3. The concept of consumer surplus.
           
            2. ORDINAL UTILITY:
                         This analysis is given by Licks and R.G.D. Allen. As per this approach, utility cannot be measured but expressed in ordinal numbers like 1st, 2nd, 3rd, _ _ _ _ etc. There are 2 concepts under ordinal utility. They are:

            1. The indifference curve analysis.
            2. The revealed preference theory.