One reason why the price of diamonds is so high is because the
A) marginal utility of diamonds is zero.
B) marginal utility of diamonds is high.
C) marginal utility of diamonds is low.
D) total utility of diamonds is low.
E) total utility of diamonds is high.

Question

Quizplus · Accepted Answer

The high price of diamonds is due in part to their high marginal utility, meaning that consumers are willing to pay a lot for each additional diamond they purchase because they derive a high level of satisfaction from it. This creates a situation of high demand for diamonds and a relatively limited supply, driving up the price.

One Reason Why the Price of Diamonds Is So High