ECONOMICS
ECONOMIC SYSTEMS
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Question
[CLICK ON ANY CHOICE TO KNOW THE RIGHT ANSWER]
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Price would go up
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Price would go down
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Price would stay the same
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You wouldn’t sell any
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Detailed explanation-1: -The scarcity principle is related to pricing theory. According to the scarcity principle, the price for a scarce good should rise until an equilibrium is reached between supply and demand. However, this would result in the restricted exclusion of the good only to those who can afford it.
Detailed explanation-2: -Scarcity is one of the key concepts of economics. It means that the demand for a good or service is greater than the availability of the good or service. Therefore, scarcity can limit the choices available to the consumers who ultimately make up the economy.
Detailed explanation-3: -A shortage can be eliminated by raising the price, but scarcity can never be eliminated.
Detailed explanation-4: -Capital scarcity means the lack of nancial resources and infrastructural underdevelopment.
Detailed explanation-5: -It’s a fundamental economic principle that when supply exceeds demand for a good or service, prices fall. When demand exceeds supply, prices tend to rise. There is an inverse relationship between the supply and prices of goods and services when demand is unchanged.