Final answer:
The correct answer is option c. Scarcity is about the limited nature of resources versus unlimited wants. The best example of scarcity among the provided options is 'Water in a reservoir to provide for residents of Southern California,' showing the direct impact when a vital resource cannot fulfill all desired uses.
Step-by-step explanation:
The concept of scarcity is a fundamental principle in economics that refers to the limited nature of resources compared to the unlimited wants and needs of individuals and societies. Scarcity can best be seen in option c, which is 'Water in a reservoir to provide for residents of Southern California who have many uses for water.'
This example illustrates scarcity because, although water is essential, the available quantity in the reservoir is insufficient to satisfy all desired uses, leading to allocation decisions and potential shortfalls. Although air is abundant in San Diego County, it is not considered scarce in economic terms as its supply is more than sufficient to meet demand. As for the hamburger, while it might be the only one in a room full of vegans, it's not a good example of scarcity since the vegans' desire or demand for it does not exist.