ECONOMICS (CBSE/UGC NET)

Detailed explanation-1: -Scarcity means that human wants for goods, services and resources exceed what is available. Resources, such as labor, tools, land, and raw materials are necessary to produce the goods and services we want but they exist in limited supply.

Detailed explanation-2: -Scarcity describes the condition in which our wants are greater than the resources available to satisfy those wants. We face the problem of scarcity every day whether we think about it or not.

Detailed explanation-3: -Scarcity falls into three distinctive categories: demand-induced, supply-induced, and structural.

Detailed explanation-4: -Demand scarcity: When there is a high demand for a resource or product, due to increasing populations or changes in preferences. Supply scarcity: When the supply or resource is low or out, due to weather, disasters or resource depletion.

Detailed explanation-5: -The two main categories of economic scarcity are relative and absolute scarcity. These scarcities differ because of supply and demand: Relative scarcity: A commodity is relatively scarce when there is a rising demand for it, and there is flexibility in producers’ ability to meet that demand.