ECONOMICS
INCENTIVES
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Question
[CLICK ON ANY CHOICE TO KNOW THE RIGHT ANSWER]
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Scarcity requires people to make choices.
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Wealthy people do not face scarcity.
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Scarcity only exists in lesser developed countries.
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Expensive cars are not considered as scarce.
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Detailed explanation-1: -The correct choice is a. Scarcity is a situation where the available resources are limited (not enough) to meet the unlimited needs of people.
Detailed explanation-2: -The principle of scarcity states that there are limited goods and services for unlimited wants. Thus, people need to make choices in order to satisfy the wants that are most important to them.
Detailed explanation-3: -Since resources are limited, people must make choices related to goods and services. Scarcity is the condition of not being able to have all of the goods and services one wants because wants exceed what can be made from all available resources at any given time.
Detailed explanation-4: -Scarcity falls into three distinctive categories: demand-induced, supply-induced, and structural.