Question

Why does a high supply of diamonds drive the price of diamonds down?

Question 7Answer

a.
A high supply of diamonds means that diamonds will be purchased at a higher rate, making them not rare, and not expensive anymore.

b.
A high supply of diamonds means that diamonds will be purchased at a lower rate, making them unsellable which drives the price of them down.

c.
A high supply of diamonds means that diamonds will be purchased at a higher rate, making them unsellable which drives the price of them down.

Answer 1

[AI-generated answer — Bot GPT 3.5]

a. A high supply of diamonds means that diamonds are more readily available, creating more competition among sellers. This increased competition leads to lower prices as sellers try to attract buyers. Additionally, when there is a high supply of diamonds, consumers may not perceive them to be as rare or valuable, further driving down the price.