ECONOMICS
SCARCITY
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Question
[CLICK ON ANY CHOICE TO KNOW THE RIGHT ANSWER]
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A shortage is temporary but scarcity always exists
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A shortage results from rising prices; scarcity results from falling prices
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A shortage is lack of all goods and services; scarcity concerns a single item
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There is no real difference between a shortage and scarcity
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Detailed explanation-1: -Scarcity occurs when there are limited quantities of resources to meet unlimited needs or desires. Shortages occur when producers will not or cannot offer goods or services at current prices. Land All natural resources that are used to produce goods and services.
Detailed explanation-2: -Scarcity refers to the existence of limited resources that are not enough to address unlimited human needs or demands. On the other hand, shortage refers to an occurrence whereby the order in the market outdoes the supply available at a given time.
Detailed explanation-3: -Scarcity is ever-lasting whereas shortage is a short-term, i.e. the problem of shortage can be resolved. Scarcity is a natural phenomenon. As opposed to the shortage, which is created by market forces of demand and supply. The term scarcity is used in the context of natural resources like time, oil, land, etc.
Detailed explanation-4: -Shortages can be temporary or long term. “Scarcity” always exists because our needs and wants are always greater than our resource supply.
Detailed explanation-5: -A shortage is a situation in which demand for a product or service exceeds the available supply. When this occurs, the market is said to be in a state of disequilibrium. Usually, this condition is temporary as the product will be replenished and the market regains equilibrium.