why does water have a lower price than diamonds despite the fact that water is more useful than diamonds?

Question

The points below should serve as a guide for much detailed answer:
1. the demand and supply concepts
2. the production processes
3. the scarcity nature of both commodities

Answer 1

I think you'll find there is a bit more water than there are diamonds and is easier to get at.

Answer 2

Diamonds are much rarer than water. (answers your scarcity question) Water is easier to find and use (drilling a well, going to a stream or river versus digging deep into the ground and getting diamonds). (answers your production question halfway and the supply half of the supply/demand question) Diamonds are created by a very long term process where every time you breathe you expell water. (answers the other half of the production question) Water is in higher demand, but supply of diamonds is much more limited therefore demand for diamonds is high for a variety of reasons and harder to fulfill. Realistically if you are walking and carrying 5 pounds of water and 5 pounds of diamonds in the desert and have to lose weight to get where you are going, you would drop the diamonds---however as you drink the water the weight becomes less and the diamonds could still be with you.

Answer 3

This was a question raised by Adam Smith, hopefully you have heard of him before.

Water is more useful to humans but we pay a lower price for it then diamonds. The answer is because of the marginal utility each provides(amount of satisfaction obtained from consuming one additional unit). Water has a low marginal utility, diamonds have a high marginal utility. The lower the marginal utility the higher the demand. From the law of demand we know that with a high demand consumer's want a higher quantity for a lower price. That is why water has a lower price.

Answer 4

Diamond production is monopolized by the Debeers company, which has successfully marketed them as required gifts for certain occasions, such as weddings.

The combination of limited supply (even though industrial diamonds of higher quality can now be created) and marketing to create demand has created a perfect market. Prior to giving stars like Marilyn Monroe diamonds for free to flaunt on the big screen for example, consumer demand didn't exist. It has come from not being an item anyone cared about to being something men are expected to drop 1/4 of a years income on when getting married.

Brilliant, and evil.

Answer 5

1. Water per se is much more plentiful than diamonds;
"fresh" (potable) water is the comodity that is scarce, but can be extracted for a cost. There are 6 billion consumers of water and probably less than 2 billion consumers of diamonds.
2. The most expensive methods for obtaining potable water are still cheaper than obtaining most diamonds
3. Water isn't marketed as well - water isn't a "girl's best friend".

Answer 6

Water can be renewed and used for other purposes such as food, hygiene which is essential for human development as regards to the economics of developing countries, also renew water for manufacturing, so water is a key ingredient in the process of adding value to products in industry. Usefulness's agreed. regarding 3. Diamonds are scarce hence their self-reporting value, but the expensive price of diamonds reverts drastically when you compare a diamond that has been cut and to one that has not been cut. A diamond that has been cut and set is worth less in commercial terms than a diamond that can be readily used for industrial purposes such as in aircraft components, because diamonds are the toughest materials around and will not weather to the same extent as say copper or stainless steel. (sorry to give such a long answer), Water has a lower price because it can be renewed recycled, usefulness is outside of economic theory regarding utility. Water may not be as cheap around the world, ref to Hong Kong whom buys her water from China mainland, Singapore who buys her water from Malaysia.

Answer 7

Without diamonds a number of cutting tools vital to industry would not be available. Water is also necessary when using diamond cutters and other cutting tools.

Answer 8

1- Our Merciful & Most Generous God supplies water for his creatures, while greedy human merchants supply diamond for choosy rich humans.
2- Rain water is the best-quality water available . Again, it is our merciful God who "Controls" this production process.... not man.
3- Water is more scarce than air, yet the air we breathe is "FREE" of charge ..!! Have you noticed that wisdom of the Great Supplier ?!!

Answer 9

b8fff7aca771d27b8dd3e7ca6dc3a9ef3O+ is hydronium. this is what you get whilst your water is acidic. Acids could nicely be seen merely strategies with extra H20+'s floating around. those H20+'s related themselves to any water this is around to type b8fff7aca771d27b8dd3e7ca6dc3a9ef3b8fff7aca771d27b8dd3e7ca6dc3a9ef+. This then floats around and variety of includes alongside extra water molecules to unfold the cost and additionally you get issues like b8fff7aca771d27b8dd3e7ca6dc3a9ef3b8fff7aca771d27b8dd3e7ca6dc3a9ef[b8fff7aca771d27b8dd3e7ca6dc3a9efb8fff7aca771d27b8dd3e7ca6dc3a9efb8fff7aca771d27b8dd3e7ca6dc3a9ef]6+

Answer 10

You can`t wear water on your finger or around your neck
You can`t drink or wash in diamonds.
Diamonds are quite difficult to mine.
Water is easily obtainable to most of the world.
Diamonds are precious gems.
Water is a precious commodity.
Especially to people who have none.