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It is assumed that each choice is made after careful consideration of the benefits and costs of their decision. The premises for these models is to find out what & how to produce products, this is modeled after the Traditional Economic System.
Economists are concerned with exactly how much a person will pay for "goods" and that is considered marginal utility. All of this ties to the Diamond-Water Paradox because the demand for diamonds is high as is the price, with that the demand for water is also high but the cost is significantly lower. As the consumption of water increases it is valued less than the consumption of Diamonds...
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Common topics in this essay:
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