cecilia has studied economics and knows about the value and investment potential of diamonds. the price of…
cecilia has studied economics and knows about the value and investment potential of diamonds. the price of diamonds has recently decreased, and a new diamond mine has opened nearby. cecilia decides to buy a diamond necklace while the prices are lower. how did cecilias knowledge of economics help her make a savvy commodity purchase? o she knew that diamonds are popular and in high demand. o she knew that diamonds are a nonrenewable resource, making them scarce. o she knew that the cost of diamonds depends only on the demand. o she knew that the purchase of diamonds will satisfy wants and needs.
Answer
Brief Explanations:
In economics, the price of a commodity is influenced by both supply and demand. A new diamond mine opening increases supply, causing prices to drop. Cecilia, with her knowledge of economics, recognized this and bought a diamond necklace while prices were low. The fact that diamonds are a non - renewable resource and scarce is related to their long - term value, but in this case, the immediate change in price due to increased supply is the key factor. Knowing that diamonds are popular and in high demand doesn't explain why she bought when prices dropped. Also, diamond cost depends on both supply and demand, not just demand. And while satisfying wants and needs is a general reason for purchase, it doesn't explain the savvy timing.
Answer:
She knew that diamonds are a nonrenewable resource, making them scarce.