Identify an analysis which assumes that the level of utility can be e…

Identify an analysis which assumes that the level of utility can be expressed in numbers?

Answer & explanation

Correct answer: option 1

The correct answer is Option (1) → Cardinal Utility.

Economists explain a consumer’s choices in two ways. One way supposes that the satisfaction, or utility, a person gets from a good can be measured and expressed in numbers: a shirt may give 50 units of utility, and one can then add up total utility or work out the marginal utility of one more unit. This approach is the cardinal utility analysis; the other approach only ranks bundles and never measures them.

Why the other options are incorrect

Option (2) Ordinal Utility. — Incorrect. Ordinal utility analysis was built because utility is never expressed in numbers in real life. The consumer only ranks bundles as giving more or less utility, without measuring it.
Option (3) Budget line — Incorrect. The budget line shows the bundles that cost the whole of the consumer’s income at given prices. It describes what the consumer can afford, not how utility is measured.
Option (4) possibility curve — Incorrect. A production possibility curve shows the combinations of two goods an economy can produce with its resources. It belongs to production, not to the measurement of utility.

Note: A same/similar question was asked in CUET (UG) in the papers below.

2026	2025	2024	2023	2022
13-05 S2 06-06 S1*	–	–	–	–

* A similar question.

NCERT (2025-26): “2.1.1 Cardinal Utility Analysis … Cardinal utility analysis assumes that level of utility can be expressed in numbers. For example, we can measure the utility derived from a shirt and say, this shirt gives me 50 units of utility. Before discussing further, it will be useful to have a look at two important measures of utility.

…Cardinal utility analysis is simple to understand, but suffers from a major drawback in the form of quantification of utility in numbers. In real life, we never express utility in the form of numbers. At the most, we can rank various alternative combinations in terms of having more or less utility. In other words, the consumer does not measure utility in numbers, though she often ranks various consumption bundles. This forms the starting point of this topic – Ordinal Utility Analysis.…”