Question

You are a producer who is hoping to create a specific good.

Based on what you have learned about resources and scarcity, what factors do you need to consider when producing this good?

Give your answer in the form of three to four complete sentences.

Answer 1

Producers must consider how limited a resource is when it is used to create an item. The more scarce a resource is, the greater value is given to that resource. It is important to determine if it is necessary to use a scarce resource to create a good, because a less scarce resource could be used instead. This would make it easier to produce a good, but it would give the final item a lower value.

Answer 2

A producer can include someone involved in the mining industry. Some of the factors to be considered before production starts are what are the grade and tonnage say of the metals involved? Also, the geometry of the deposit is important to know how to develop it ie open pit or underground or both. Also the economics must be considered ie what is the world market price of the metal in question and the prognosis for its future price?