Assumptions of ordinal utility theory and cardinal utility theory
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Ordinal Utility: The indifference curve assumes that the utility can only be expressed ordinally. This means the consumer can only tell his order of preference for the given goods and services.
Cardinal utility analysis of consumer's behaviour is based on which combination of the following assumptions: (i) Utility is measurable in terms of cardinal number. (ii) Constancy of the marginal utility of money. (iii) Utilities of different goods are interdependent.
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