When utility is measured in quantitative terms, it is ______ of consumer equilibrium.

Option 1 -> Ordinal approach ranks preferences without assigning numerical values to utility.

Option 2 -> Cardinal approach measures utility in quantitative terms using numerical units called 'utils'.

Option 3 -> Indifference curve approach is based on ordinal utility, not quantitative measurement.

Option 4 -> This is a law used in cardinal analysis, not an approach itself.

Hence, Cardinal Approach -> When utility is measured in quantitative or numerical terms, it represents the Cardinal Approach to consumer equilibrium. In this approach, utility is measured in specific units called 'utils' and assumes that satisfaction can be numerically expressed (like 10 utils, 20 utils, etc.). Consumer equilibrium is achieved when the marginal utility per rupee spent is equal across all goods (MUx/Px = MUy/Py). This differs from the ordinal approach which only ranks preferences without numerical measurement. -> correct