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What is scarcity? Why is it considered the fundamental problem of economics? Give examples of how scarcity affects your life.

User Ingenspor
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Answer:

Scarcity is a shortness of supply

Step-by-step explanation:

When an item is scarce, it is irreplenishable in a short time and it is a finite resource. For example, gold is scarce, wind is not- it is not a finite resource. This concept of scarcity creates a limited supply in economics, and when demand for the item increases, the price also increases. In other words, there is not enough of this particular item to provide for everyone on the earth. In life, scarcity is what creates a difference values of objects. This is why cookies are cheap and gold is expensive. Cookies can be quickly baked and replenished, whereas you cannot create more gold.

User Duong Nguyen
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