The "paradox of value," with respect to prices and consumer purchases, refers to which one of the following?
A)Prices of commodities are not always proportional to the total satisfaction they give us.
B)It is impossible to explain the price of a commodity in terms of either demand factors alone or supply factors alone.
C)It is impossible to explain why people's tastes are what they are, or why tastes vary from one person to the next.
D)Some consumers tend to value commodities according to their price, even to the point of buying more if the price goes up.
E)None of the above.

Question

Quizplus · Accepted Answer

The paradox of value states that prices of commodities are not always proportional to the total satisfaction they give us. This means that some expensive goods may not provide as much value as cheaper ones, and vice versa. It is also known as the diamond-water paradox, as diamonds are much more expensive than water even though water is a necessity for survival while diamonds are not.

The "Paradox of Value," with Respect to Prices and Consumer