The Paradox of Value Is Illustrated by the Fact That

question 226

Multiple Choice

The paradox of value is illustrated by the fact that

• A) a pound of bread is cheaper than a pound of gold.
• B) teens buy designer jeans.
• C) if diamonds were free they would no longer be useful for engagement rings.
• D) gold and diamonds occupy little space.

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Definitions:

Time Spent

The duration or amount of time dedicated towards conducting an activity or accomplishing a task.

Budget Constraint

An economic model representing the combinations of goods and services that a consumer can purchase given current prices within their income level.

Gift Certificates

Vouchers that are purchased and can be given as gifts, which the recipient can use as a payment method in the designated store or service.

Optimal Consumption

The consumption level at which an individual's utility (satisfaction) is maximized for their income or budget.