Cardinal utility

Cardinal utility is a concept in economics that measures the satisfaction or value a person gains from consuming goods or services using specific numerical values. It assumes that individuals can compare and assign exact amounts of happiness, so one can say a particular item provides a certain "units" of pleasure or usefulness. This approach helps analyze decision-making by quantifying preferences, allowing economists to understand how people prioritize choices based on the relative satisfaction they expect to receive. Essentially, it assigns measurable numbers to feelings of satisfaction, facilitating more precise economic analysis.