Demand for diamonds

It’s been a tough year for De Beers, the world’s largest diamond producer, as sales have sunk by 44%. This is a great example for a lesson on supply and demand. Click read more for some GCSE style questions to go with this article.

1. Explain what could have caused the demand for diamonds to change over the last year. With the help of diagrams, show how these changes would affect the price and sales of diamonds (6 marks)
2. De Beers decided to cut production of diamonds when they realised demand had reduced. With the help of a diagram explain why they took this action. (6 marks)