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Diamonds are expensive, but they have little practical value; water is cheap, but has great utility in everyday life. Adam Smith was perplexed by this

"Diamonds are expensive, but they have little practical value; water is cheap, but has great utility in everyday life." Adam Smith was perplexed by this diamond-water paradox. Using price and demand curves, show how you could explain this diamond-water dichotomy to Adam Smith.

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