Scarcity
Definition
Scarcity refers to the limited availability of resources in relation to unlimited wants and needs. It means that there are not enough resources to satisfy all the desires and demands of individuals or society.
Analogy
Imagine you're at a buffet with a limited amount of food. There are so many delicious options, but you can only choose a few because there's not enough for everyone to have everything they want.
Related terms
Choice: The act of selecting among alternatives when faced with scarcity.
Factors of production: Resources used in the production process, such as land, labor, capital, and entrepreneurship.
Production possibilities curve: A graphical representation showing different combinations of goods and services an economy can produce given its resources and technology.
"Scarcity" appears in:
Subjects (2)
Study guides (3)
Additional resources (2)
Practice Questions (5)
- Scarcity is best defined as?
- Scarcity gives rise to choices because?
- Why are trade-offs necessary in decision-making when faced with scarcity and limited resources?
- How does scarcity affect the determination of prices in a market economy?
- Which of the following best describes scarcity?
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