Is there an economic theory about the relative value of money amongst different strata of the population?

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Question: 

Is there an economic theory that describes the relative value of money amongst different strata of the population? For example, $100 might seem like a lot to an Economics professor, seem like almost nothing to a pro baller and might seem unimaginable to someone in true poverty. Thanks!

Answer: 

I am guessing, by money, you mean income. Yes, the notion that $100 means something very different to people with varying incomes is a basic tenet of economics. The question is, what do people do with that $100. If they consume (buy stuff) it, then economists argue that the "value" of that $100 is much higher for someone with low income (hence, low consumption) than someone who is far richer (and who consumes much more). This is the law of diminishing marginal utility of consumption at work. In this case, the value being referred to is happiness/satisfaction.

Last updated on September 20, 2016