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The indifference curve analysis of demand treats utility as a concept that is:
Aexpressed in money utils
Bconstant across all goods
Ccardinal and measurable
Dordinal and based on ranking
Answer & Solution
Correct answer: D. ordinal and based on ranking
1. Indifference curve analysis assumes utility is only ordinally expressible.
2. The consumer can rank combinations as first, second and so on, but cannot say by how much.
3. Cardinal measurability and money-utils belong to Marshall's approach, and utility is not constant across goods, so those options are wrong.
_Source: ICAI BoS CA Foundation Paper 4 Business Economics, Ch 2 Unit II "Theory of Consumer Behaviour", p.12_
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