what is scarcity?
If something is scarce - it will have value. If the market supply of a good is low, the price will rise providing there is demand for it. Goods that are not scarce will have a lower market value.
Finite resources
There is only a finite (limited) number of workers, machines, factories, acres of land and reserves of oil on the planet earth.
There is also a limited pot of money available to government to finance their spending priorities - the Government cannot raise taxes too much to fund health and education without affecting other areas of the economy.
Productive resources are limited. Therefore, people cannot have all the goods and services they want; as a result, they must choose some things and give up others
Because economic resources are finite, we cannot produce an infinite number of goods and services. By producing more for an ever-increasing population, we are in danger of destroying the natural resources of the planet. See the related pages on the standard of living
Wants and basic needs
Human beings want better food; housing; transport and health services. Whilst economic resources are limited. Human wants are not - indeed basic needs and wants are infinite. Whether it is a person struggling to feed herself in the developing world, or a millionaire seeking to increase her fortune in the USA, there is always something more an individual wants.
Economic wants are desires that can be satisfied by consuming a good, service, or leisure activity
The development of society can be described as the emergence of new wants and needs - which producers attempt to supply by using the available factors of production.
People make choices because they cannot have everything they want - having more of one thing normally means having less of something else.
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