ECONOMICS (CBSE/UGC NET)

Detailed explanation-1: -All the resources in the world are limited. However, individuals’ desires and needs are unlimited. In economics, this problem is known as scarcity. Scarcity has been the key issue to solve by economists who try to effectively allocate the scarce resources in the population.

Detailed explanation-2: -One of the defining features of economics is scarcity, which deals with how people satisfy unlimited wants and needs with limited resources. Scarcity affects the monetary value people place on goods and services and how governments and private firms decide to distribute resources.

Detailed explanation-3: -For example, time and money are characteristically scarce resources. In the real world, it is common to find someone with little of one resource or even both.

Detailed explanation-4: -The basic root of economic problems arises from the fact that resources are limited and wants are unlimited thus the resources are scarce. Society must now choose what to produce, how to produce and for whom to produce.