ECONOMICS (CBSE/UGC NET)

Detailed explanation-1: -Goods and services are the product of resources. If resources were abundant without limit, then we would not have a scarcity of the products they produce. Economic problems are problems of relative scarcity wants exceed resources in the relative sense.

Detailed explanation-2: -All goods and services are scarce because they are finite and the result of trade-offs. For a good to exist or service to be offered, others must allocate their time to producing or delivering that service.

Detailed explanation-3: -Shortage and scarcity mean the same thing. All goods and services are scarce. Scarcity always exists. Market competition allows people to have all that they want.

Detailed explanation-4: -Demand increases when resources become limited, not when supply of resources exceeds demand. Thus a resource is scarce when its availability is limited, and demand for it is high.

Detailed explanation-5: -Resource scarcity occurs when demand for a natural resource is greater than the available supply – leading to a decline in the stock of available resources. This can lead to unsustainable growth and a rise in inequality as prices rise making the resource less affordable for those who are least well-off.