The diamond-water paradox occurs because:

A) the price of a product is related to its total utility,not its marginal utility.
B) the price of a product is related to its marginal utility,not its total utility.
C) water is,in fact,very scarce in certain regions of the world.
D) diamonds are more useful than water.

Diamond-Water Paradox

A paradox highlighting the contradiction between the high value of non-essential items, like diamonds, and the low value of essential items, like water, mainly explained by the differences in marginal utility and scarcity.

Total Utility

The overall satisfaction or value a consumer gets from consuming a certain quantity of goods or services.

Marginal Utility

The added satisfaction a consumer gets from having one more unit of a good or service.