 Solution

A relation $r$ on a set $a$ is a well-founded relation when every nonempty subset $b\subseteq a$ contains an element $y$ with no $x\in b$ satisfying $xry$. The well-founded recursion theorem states that a rule assigning a value at $y$ from the already assigned values at its predecessors determines a unique function on $a$; the rule must give a unique set-valued output for every possible predecessor assignment. No choice or transitivity of $r$ is needed.

Apply recursion withThe empty supremum is zero. Well-founded induction makes every value an ordinal; the Axiom schema of replacement collects the values into a set. Choose an ordinal $\alpha$ larger than every value. Then $f:a\to \alpha$, and $xry$ implies $f(x)+1\le f(y)$, hence $f(x)<f(y)$.

Conversely, suppose such an ordinal-valued function exists. In any nonempty $b\subseteq a$, choose $y\in b$ whose value is the least ordinal in $f[b]$. There can be no $x\in b$ with $xry$, because it would have smaller value. Thus $r$ is well-founded, proving the equivalence.

Using the axiom of choice, fix a well-order $\prec$ of $a$. Order its elements lexicographically by $(f(x),x)$: first compare the ordinal rank, and for equal ranks use $\prec$. Every nonempty subset has a smallest rank and then a least element in that rank fibre, so this is a well-order. Since $xry$ strictly increases rank, it respects every original relation pair. Hence every well-founded relation extends to a well-order under choice.