"Essential" water is cheaper than "nonessential" diamonds because:        new industrial uses for diamonds have been discovered.        the supply of water is great relative to demand and the supply of diamonds is small relative to demand.        although the total utility of diamonds is greater, their marginal utility is small.        the supply of diamonds is great relative to demand and the supply of water is small relative to demand.

Managerial Economics: Applications, Strategies and Tactics (MindTap Course List)
14th Edition
ISBN:9781305506381
Author:James R. McGuigan, R. Charles Moyer, Frederick H.deB. Harris
Publisher:James R. McGuigan, R. Charles Moyer, Frederick H.deB. Harris
Chapter2: Fundamental Economic Concepts
Section: Chapter Questions
Problem 1E: For each of the determinants of demand in Equation 2.1, identify an example illustrating the effect...
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"Essential" water is cheaper than "nonessential" diamonds because:

       new industrial uses for diamonds have been discovered.

       the supply of water is great relative to demand and the supply of diamonds is small relative to demand.

       although the total utility of diamonds is greater, their marginal utility is small.

       the supply of diamonds is great relative to demand and the supply of water is small relative to demand.

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