The pattern is done in stockinette stitch with color changes providing the visual interest. Using circular needles makes the color changes easier, because you are always knitting for most of the garment. Be sure to check your gauge before beginning the pattern, or your images and garment will be distorted in size. Colorwork requires following patterns that indicate the color of each stitch by symbol.
The two main colors require 2 and 2+ skeins, respectively. The other 3 colors require less than a full skein each.
The hat was improvised from color patterns found in the cardigan and using the hat in #15508 from the same book as a guide to size.