The water and diamonds paradox of value
A) is that water is essential for life and yet is cheap, whereas diamonds are totally nonessential and yet are expensive.
B) points out that we generally have a low total utility of water and a high total utility of diamonds.
C) is resolved by the principle that market price is determined by total utility, not marginal utility.
D) None of the above

Question

Quizplus · Accepted Answer

The water and diamonds paradox of value is that water, which is essential for life, is widely available and cheap, whereas diamonds, which are nonessential, are rare and expensive. This highlights the fact that value is not solely determined by usefulness, but also by scarcity and social perception.

The Water and Diamonds Paradox of Value