Question
Why Are Diamonds More Expensive Than Water? Water is simultaneously one of the few things we absolutely cannot live without, and one of the things
Why Are Diamonds More Expensive Than Water?
Water is simultaneously one of the few things we absolutely cannot live without, and one of the things we value least. There's an economic rationale behind that.
Theideathathouseholdsandfirmsmustmakechoicesbecauseofscarcityisthefundamentalnotionofeconomicanalysis.Wenowwanttoexpandonthatanalysistoconsiderwhyconsumersbehavethewaytheydo.Whydoesapersondemandacertaingoodorservice?Anobviousansweristhatthegoodorserviceisexpectedtosatisfysomeneedordesireoftheconsumer.
Examine the diamond-water paradox. Why are diamonds more expensive than water?
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Macroeconomics Policy And Practice
Authors: Frederic Mishkin
2nd Edition
0133424316, 978-0133424317
