Final answer:
The concept stating that our mental resources are finite and limited is related to the psychological notion of attention scarcity, illustrating that we must prioritize where we focus our cognitive efforts. It is also related to the economic principle of scarcity, where we must choose how to allocate limited resources among various wants and needs.
Step-by-step explanation:
The concept that people have a finite amount of mental resources available at any time refers to the limitations on our cognitive processing capacity, often discussed in the context of attention and the allocation of mental effort. It highlights the scarcity principle within cognitive psychology, implying that our mental bandwidth for processing information and paying attention is restricted. This scarcity forces individuals to prioritize where to focus their attention, since engaging in one mentally taxing activity can reduce the cognitive resources available for other tasks.
The selective attention test by Daniel Simons and Christopher Chabris exemplifies this concept, as it demonstrates how our focus on certain tasks can make us oblivious to other events happening in our surroundings, further showcasing the limits of our attention.
In relation to economics, the scarcity concept is an essential principle that indicates how resources - including time, money, and physical assets - are limited, thereby compelling individuals and societies to make choices about how to allocate these finite resources among competing ends.