vered since, in actuality, it has no use in determining human survival.People have searched for a resolution to the The Diamond-Water Paradox for years. One could attempt to resolve the paradox by attempting to use the concept of marginal utility (MU) as it relates to total utility (TU). To a person suffering of dehydration in the middle of the desert a glass of water would most likely have a higher MU than any other substance know to man. He would seemingly maintain a very high level of MU for the next few glasses of water, with each glass his TU would continue to grow, but his MU for each glass would gradually begin to fall. He will desire each next glass increasingly less and less. Eventually his MU for the water would reach the point that he would receive a greater satisfaction from another good (perhaps a plane ride out of the desert). This is how most of us feel as it pertains to water. While we are in constant need of the substance, we seem to have a never ending supply that is available at our simple command. Because of this we receive greater satisfaction from goods which may, in actuality, have a lower real value to us. This helps us to maximize our consumer optimization. Consumer optimization says if our MU for one item falls below the MU of another item, we should choose the second item, whatever it may be. Therefor the demand of the first good would begin to level off while the demand for another good will begin to rise.When looking at or measuring MU we must take into account the scarcity of the given good. Take The Diamond-Water Paradox for example. As noted, MU is the satisfaction we get from each next unit of the good consumed. As we consume more and more water our MU for each next unit will fall. We can eventually reach a point where water will give us negative satisfaction. As we begin to receive each unit of diamonds our MU will be very high. Now, as we receive each next unit of diamonds our MU will ...
