The paradox in "the paradox of value" refers to the
A)confusion between supply curves and demand curves.
B)fact that goods with high total values command high prices.
C)fact that goods with low total values command low prices.
D)situation where a good that is necessary to sustain life is "more valuable" than a decorative,luxury item.
E)situation where a good with a low total value can command a high price,while a good with a high total value can command a low price.

Question

Quizplus · Accepted Answer

The paradox of value refers to the situation where a good with a low total value can command a high price, while a good with a high total value can command a low price. This is paradoxical because one would expect goods with higher total values to command higher prices. For example, a diamond has a low total value (it is not necessary for survival), but commands a high price due to its rarity and desirability. On the other hand, water has a high total value (it is necessary for survival), but commands a low price due to its abundance.

The Paradox in "The Paradox of Value" Refers to the