Not all decisions are marginal, however.Some decisions really are all-or-nothing: deciding whether to shut down your business or stay open; deciding whether to offer a new product line; deciding whether to get married; deciding whether to move to New York.While teachers are available in abundance like water, athletes are rare and so they are considered to be a precious commodity like diamonds and this scarcity is the reason they are paid such enormous amounts of money each year.A modern equivalent of the diamond-water paradox: Why do basketball players get paid so much more than teachers, when teachers are so much more important?This paradox was resolved by the introduction of marginal thinking.
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If, in fact, only a few litres of water were available, marginal valuation of water would have been much greater than that of diamonds.Demand curve Dw representing marginal valuation or marginal utility of different quantities of water is at higher level.The marginal benefit or marginal valuation per litre of water for the consumer is very low as the actual supply of water per period is large.In case of water market price as determined by it’s marginal utility is very low but consumer surplus from it is very large.However, for modern economists there is no paradox about it as they are able to explain the large price differential between water and diamond.
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As such, water which is plentiful has enormous total utility, but a low price because of a low marginal utility.In the case of water, the supply (at least in Marshall’s time) was so large as to exceed the amount that could possibly be demanded at any price.This conditions stated that water is no longer free!!.So, SW (Supply of water)>DW (Demand of water) at any price (P) P=0 • Nowadays, the demand for water increased, because of the population growth and rising prosperity, while the supply has remained roughly constant.It is well known that natural resources (in this case water) are unseparable parts of our life & living without them will be ‘almost’ impossible!
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This explain why diamonds are more expensive than water.The marginalist theory of value in this instance clarifies this phenomenon by explaining that the usefulness of water as a whole affects price, and not the usefulness of one unit of water (total utility) but as a whole or marginal utility.In other words, because water is in large supply, the marginal utility is low and therefore the price is proportionally low.Conversely, because diamonds are useful but scarcer, each small unit of diamond is more useful than say, a bottle of drinkig water.Marginal utility Graph But the prices of commodities, be it diamonds or water, have also other origin: namely, the intervention or non-intervention of governments, depending on what particular econ...
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“Big Ethanol Shakeout Coming?” 21 August 2007.The Water-Diamond Paradox is considered a contradiction since, relatively, water is more essential to life compared to diamonds, yet, diamonds have higher price compared to water or the price of water is way cheaper compared to diamonds.Cellulosic ethanol is a biofuel which can be produced through utilizing corn, starch, woodchips to name a few.postversion=2007082107>.
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At the community or group level, to be a well-informed and wise citizen, every person should be equipped with at least basic tools of economic analysis.Brue, S. , & Mcconnell, C. (2006).It is quite normal at the time of election that the contesting parties also given a significant space to the economic reforms and policies in their election manifestoes.Thus, voting decision may also be influenced by the knowledge of economics.Having at least a functional knowledge of economic would help to evaluate which party has better policies.
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It is used to maintain these wealth inequalities (Peet: 1975).Poverty is seen as an inevitable re-sult of capitalism, benefiting the ruling class as it ensured that there was a workforce that was always willing to work for lower wages.This essay will try to explain this paradox through two contrib-uting factors: corruption and conflict.To help explain poverty in Africa I will now look into cor-ruption as a contributory cause.The only way to overcome poverty is for the bourgeoisie to overthrow the proletariat and the capitalist system.
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The marginal benefit of a glass of water can be large or small.However, from my point of view to drink a glass of safe and clean water, the marginal value will be little because of the lack of sanitation in a few countries around the globe.Since diamonds are rare and difficult to be obtained as it can be unreasonably expensive, its satisfaction of having one of them is greater than drinking water... Water is an essential element for life.The first glass of water is enough to quench thirst.
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For years utility theory misplaced its focus on average or total utility, asking questions such as “Why are diamonds more expensive than water?” (given that they are fundamentally trivial rather than life-saving.)The employer pays for this security, rather like a warranty, by offering higher salaries to these people, expecting good performance.Water is judged by the value of the last drop, not the first, since it is the last drop that people are being asked to choose whether they want or not at current prices.This is like saying that if you were to create the right conditions then people would swap large numbers of diamonds for small amounts of water.Nowhere is this more true than in the recognition that marginal values (MRP and MU), not...
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Young, immature birds can also help their parents with subsequent broods.The Gouldian Diamond is found mainly in northern Australia: from the Cape York peninsula, northwest Queensland, the northern Northern Territory and the Kimberley region in the north from Western Australia.The origins and phylogeny of the Gouldian Diamond have been studied by Antonio Arnaiz-Villena et al.It inhabits the eucalyptus wooded savannah plains near mangroves, and migrates only if it lacks water or food, in areas no more than 40 kilometers away.In the wild, the Gouldian Diamond feeds mainly on the seeds of six types of grasses such as those belonging to the genus Triodia.
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Diamond is well known as the hardness natural substance, and results from four strong covalent bonds giving diamond a strong rigid extended and continuous structure, so diamond just can be cut by other diamond.Water is taken as a typical type of the simple molecular structure (Lower, 2010).In addition, water molecules forms hydrogen bonding.Figure 5: Hydrogen Bonding Between Water Molecules (Adapted from Google, 2010) .There are no ions existing in these substances, so they are insoluble in the water and can not conduct electricity (Lower, 2010).
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He also argues that the diamond is a mutually reinforcing system. First-mover Implications .The theories discussed have at least three main implications for international businesses: Location Implications .Four attributes that constitute the Porter’s Diamond: .The Leontief Paradox- a famous study published in 1953 by Nobel Prize winner Wassily Leontief.
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Some other diamond mines owned by small companies have less control on the diamond market and this is unethical in business.On the other hand Diamond Development Initiative should aim to address the political, social and economic challenges facing the small scale informal diamond mining sector and to optimize the beneficial development impacts of small scale formal diamond mining to miners.This has resulted to the prices of the original diamond of the company that it mines to go down since the competition is very high in the market place as people tend to prefer synthesized diamond that serve the same purpose in the market.De Beers Company over the past has been involved in illegal trade of diamond by funding the rebels to mine diamonds ...
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It would not be advised to enter the market in east/northeast India unless selling cheap bottled water because the area is very rural and poor and there is only really a market for selling healthy, clean and sanitised water (Soft Drinks in India, 2011).Within international business management, when applying Porter’s national diamond, it should be ensured to consider every single aspect that Porter recommends in to major detail to ensure a forecast for investment is as accurate as possible.These brands not only offer standard carbonated soft drinks and bottled water but speciality bottled teas and coffees.Also factors such as soaring prices in sugar or limited water supply could dramatically affect the manufacture and production of soft d...
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Therefore, we are required to pay the price in water that is low than the price in diamonds.Due to large of water consumption, the total utility of water is very large, if we have used the water in the last gallon, in this moment, the total utility of water is comparatively quiet.In this case, we will be used water and diamond to show our analysis.Because of no limits and not priced in unmetered water, people do not worry losing these water.Totally, the supply of water is comparatively plenty, but the supply of diamonds is comparatively finite.
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This allotrope is also known as “hexagonal diamond”.Lonsdaleite is a hexagonal allotrope of the carbon allotrope diamond.One is by mixing the soot of nanotubes of carbon in water and surfactant.Diamond is the best know allotrope of carbon.The great heat and stress of the impact causes it to turn into diamond however it retains the graphite hexagonal crystal lattice.
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In the year of 2009, the use of reused and recycled water was increased from 45% to 57% from the past year.Since 1888, De Beers is the world’s leading rough diamond company with the expertise in exploring, mining and marketing of diamonds.As a leading diamond mining company, De Beers are committed to the development of the host country by minimizing the impact of mining on natural landscape and ensure safe and healthy environment for our employees and communities where we do operations.According to Tracey Lloyd (2009) in her article CSR in South African Diamond Mining, Benchmark Foundation found a 100% implementation of environmental management programs with the standard criteria of ISO 14001.The corporate social responsibility play a si...
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Porter’s Diamond theory reflected all these fundamental concepts in its model and in every question put by the Porter lies under the elements which are categories under four in his model.Only 2.0 hectare area of water is own by the more than 90% of the aqua farmers.Thus, increasingly, marketing courses and texts incorporate the diamond as part of the analysis of industry (Baker, 1992).With the help of Diamond model of Porter’s the national competitive environment and the Indian shrimp industry van be assessed and is presented in Figure 1.The water spread in total is constituted just 0.54% of this which is out of the 140,936 hectare in country is developed for culture of shrimps.
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The transaction was worth $5.1 billion in cash and ended the Oppenheimers’ De Beers Dynasty’s 80-year ownership in the world’s largest diamond miner.De Beers Diamond Jewelers’ is the quintessential diamond jeweler, giving substance to style, bringing together the diamond’s dualities of science and poetry, melding its rich history and long traditions with contemporary creativity and cutting-edge craftsmanship.De Beers Consolidated Mines was formed in 1888 by the merger of the companies of Barney Barnato and Cecil Rhodes, by which time the company was the sole owner of all diamond mining operations in the country.De Beers is well known for its monopolistic practices throughout the 20th century, whereby it used its dominant position to mani...
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Why is the price of an ounce of diamonds far higher than the price of an ounce of water?Here is a small graphical example explaining the demand and supply of computers with the increasing in demand and supply but falling in the prices of computers in today’s free market.a) Increase in demand, price and quantity both increases .There are four laws of increased and decreased in the price and quantity of computers, they are:- .d) Decrease in supply, price increases and quantity decreases .
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5 Billions of dollars every year, and the global diamond sales that generate $72 Billion dollars just in diamond jewelry sale.For example, changes in the water quality, destruction of watercourses, and potentially loss of fish through draining of rivers and lakes.In this paper we will go through a research journey to find out more about the positive and negative impacts of diamond mining in Africa and the diamond industry.To promote the trading of diamonds from legitimate sources and to ensure that consumers can be confident in their diamond jewelry purchases, governments, NGOs and the international diamond industry have worked together to implement a certificate of origin system, known as the Kimberley Process.The diamond mining sustain...
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Research shows clearly that water has offered a justification for engaging into war as it has been a major object of political and economic strength, military conquest as well as a tool of conflict.Water in the middle East potential for conflicts and prospects for cooperation.Other examples of disputes have emanated from the joint management of Euphrates River between Syria, Turkey and Iraq and ways to protect water quality for those who are dependent on such resources.Water just like other known and common factors can cause rivalry due to its scarcity, extent of supply from one state or region to another, basin states’ relative powers as well as ease of access to other alternative freshwater sources among others.Recently, various pressu...
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If we compare the price of water to the price of diamonds, there is a dramatic difference.In fact, in the marketplace, it is rarely possible for supply and demand to go the path we have designed.If the price of diamonds are as cheap as water, will people still ware it on their fingers or as an engagement gift?If supply and demand curves shift around in different geographical regions, or in different periods of time, then shall we get to assume that economic equilibrium is well-defined?On one hand, supply and demand can be used to describe and measure the market, but on the other hand, for the factors are numerous, the curve is a result of price and quantity as well as a combination of demand and supply, and surely these reasons make the ...
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1) The Harvard case, Botswana: A Diamond in the Rough, describes the exceptional case of Botswanas sustained economic rise from near absolute poverty to a country with a 10% average annual GDP growth for more than four decades.2) The most evident pro of nationalizing Botswanas diamond industry would be to achieve the short-term gains by selling stockpiled diamonds.The extent to which this model is replicable outside of Botswana depends on the level of faithfulness to the social and macroeconomic policies described above and a working mix of formal institutions and adequate substitute organizations.The most prominent of these situations was the countrys brokered relationship with the DeBeers Corporation which provided the country which te...
1141 words (2.9 pages)
The third factor, relating and supporting industries explains that when local industries compete against one another, this spurs the emergence of cost effective and innovative inputs....ncreasing day by day7.This very well indicates that in the future biofuel demand will lead to more innovative, cheaper production.The problem right now is that new technology has not been innovated.The last factor, firm strategy, structure, and rivalry states that over the long run more local rivalry is better since it puts pressure on firms to innovate and improve.
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This is also, says Diamond, why the people of Africa were colonized by Europeans.Miller, Shaun and Jared Diamond.The domestication of animals lead, says Diamond, not only to the spread of disease, but also to advancement in technology.Water also still makes a difference in economic well-being as well.The countries in the tropics suffer from diseases like Malaria, which, say Diamond and Miller, has warded of colonists and still retards economic growth in many areas.
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On the other hand the Porter’s Diamond framework provides a basis for the analysis of the impact of the home market of the firm on its international activities.Thus, a closer observation at BMW’s basis of international competitive advantage could be derived to Porter’s Diamond framework.However implementation of these recommendations will lead to a different set of challenges.Thus the firm has to be sensitivity to the implementation issues and ensure the avoidance of any mistakes.In the case of BMW the analysis revealed that the company’s home market conditions are favourably influencing its endeavour to enhance the international participation.
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The Blood Diamond industry in Sierra Leone destroyed any hope of gaining a proper economic structure.Countries across the world found the diamond industry to be an excellent source for the economic build-up of a country, however, for Sierra Leone, it was quite the opposite.The Blood Diamond mining has resulted in major water contamination areas all over Sierra Leone, leading to major health risks.In Nikki Skuce’s scholarly article, she explains “Diamond mining…the constant clearing and digging of land results in soil erosion, water contamination and silting of rivers and creeks.It will ultimately take decades for this nation to recover from the social impacts caused by the production and protection of the Blood Diamond industry.
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** Leontief Paradox revealed that countries can export products that use less resources and be successful International Product Life Cycle Theory Each product and its associated manufacturing go through 3 stages of evolution: introduction inventor country enjoys a monopoly in manufacturing/exports.nurture/support promising industry sectors with potential for regional or global dominance Tax Incentives Monetary & fiscal policies Rigorous educational system Investment in national infrastructure strong legal & regulatory systems .Even in absense of superior comparative advantage – some succeed best as their volume increases Ex: commercial aircraft industry has very high fixed costs – need high volume sales to achieve profit .Cri...
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The kids at the shore hurry to the water anxiously waiting for the man made waves to appear.Suddenly, there is a strange dong behind me comming from the hotel, but no one cares because overriding the sound is a huge yellow speedboat with the word thriller wrote in red on the side.As I look at the water it seems like an ocean full of diamonds.Many people feel that there is very little activity at the beach and it is just a laid back place.The sand almost has the same affect only instead of diamonds it is a ground drenched in glitter because of the beams of sunlight reflecting off of every grain of sand.
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