Scarcity

Examples of Scarcity in the following topics:

• Scarcity Leads to Tradeoffs and Choice

  • A fundamental concept in economics is that of scarcity.
  • In contrast to its colloquial usage, scarcity in economics connotes not that something is nearly impossible to find, but simply that it is not unlimited.
  • The concept of trade-offs due to scarcity is formalized by the concept of opportunity cost.

• Reasons for and Consequences of Shifts in the Aggregate Demand Curve

  • However, as the system evolves and aligns itself closer to the highest potential output (optimal utilization of resources or Y*), scarcity will naturally cause the prices to increase more than the overall output in a system.
  • This is somewhat intuitive economically when scarcity and utilization are taken into account.

• Microeconomics

  • The two key elements of this economic science are the interaction between supply and demand and scarcity of goods .

• Changes in Demand and Supply and Impacts on Equilibrium

  • This is an intuitive theory underlining the fact that scarcity is relevant to the willingness to pay.
  • As discussed above, scarcity plays a critical role in pricing and thus controlling supply is often even considered a strategic play by companies in specific industries (most notably industries like precious stones, rare earth metals, etc.).

• Impacts of Surpluses and Shortages on Market Equilibrium

  • From this vantage point shortages can be attributed to population growth as much as resource scarcity.

• Production Possibility Frontier

  • Economists can use a PPF to illustrate a number of economic concepts including scarcity, opportunity cost, productive efficiency, allocative efficiency, and economies of scale.

• Defining a Good

  • Because of their relative scarcity, many private goods are exchanged for payment.

• Is Economic Growth a Good Goal?

  • This figure demonstrates the risk of over-consuming our natural resources, ultimately resulting in scarcity of necessary goods.

• Introduction to the Economic Problem

  • Knowledge about how the natural and built environments can be manipulated to satisfy wants is another way to minimize the scarcity problem.

• Introduction

  • Knowledge about how the natural and built environments can be manipulated to satisfy wants is another way to minimize the scarcity problem.