Scarcity and Choice Scarcity means that people want more than is available. Scarcity limits us both as individuals and as a society. As individuals, limited income and time and ability keep us from doing and having all that we might like. As a society, limited resources such as manpower, machinery, and natural resources fix a maximum on the amount of goods and services that can be produced.
Economics is the science which studies human behaviour as a relationship between ends and scarce means which have alternative uses. There would be no need to make decisions about how to allocate resources, and no tradeoffs to explore and quantify.
In the real world, on the other hand, everything costs something; in other words, every resource is to some degree scarce. Money and time are quintessentially scarce resources.
Most people have too little of one, the other, or both. An unemployed person may have an abundance of time, but find it hard to pay rent. A hotshot executive, on the other hand, may be financially capable of retiring on a whim, yet be forced to eat ten minute lunches and sleep four hours a night.
A third category has little time or money. People with abundant money and abundant time are seldom observed in the wild. Take air, for example. From an individual's perspective, breathing is completely free.
Yet there are a number of costs associated with the activity. It requires breathable air, which has become increasingly difficult to take for granted since the industrial revolution. In a number of cities today, poor air quality has been associated with high rates of disease and death. In order to avoid these costly affairs and assure that citizens can breathe safely, governments must invest in methods of power generation that do not create harmful emissions.
These may be more expensive than dirtier methods, but even if they are not, they require massive capital expenditures. These costs fall on the citizens in one way or another. Breathing freely, in other words, is not free.
If a government decides to allocate resources to making the air clean enough to breathe, a number of questions arise. What methods exist to improve air quality?
Which are the most effective in the short term, medium term and long term? What about cost effectiveness?Science and economics. Read the latest scientific research pertaining to economic theory, including practical applications.
It’s the study of scarcity, the study of how people use resources and respond to incentives, or the study of decision-making.
It often involves topics like wealth and finance, but it’s not all about money. Study Island is a leading academic software provider of standards-based assessment, instruction, and test preparation e-learning programs. Economics is best described as the study of: how markets find resources how businesses maximize profits how goods and services are produced how a country chooses to allocate its scarce resources.
Learn economics scarcity with free interactive flashcards. Choose from different sets of economics scarcity flashcards on Quizlet. Course Summary Economics Macroeconomics has been evaluated and recommended for 3 semester hours and may be transferred to over 2, colleges and universities.