Final answer:
Natural resource economics is the study of how to manage the earth's renewable and nonrenewable resources sustainably, focusing on supply, demand, and allocation while balancing current needs against future well-being. Option 3 is correct.
Step-by-step explanation:
Natural resource economics is a field of study focused on the supply, demand, and allocation of natural resources, which can be either renewable or nonrenewable. Understanding the distinctions between these two types of resources is crucial in this field. Renewable resources, such as sunlight, wind, and timber, are replenished naturally at a rate that can keep up with human consumption. In contrast, nonrenewable resources, like fossil fuels and precious metals, exist in finite amounts and are consumed more rapidly than they can naturally be replaced. The study of natural resource economics encompasses the extraction, utilization, conservation, and management of these resources, considering their role in supporting life and the economy.
It is important to note that usage and availability of these resources are influenced by economic principles, technological advancements, and societal values, which can affect their sustainability. Ultimately, all resources are finite if not harvested or utilized in a sustainable way. Natural resource economics also involves analyzing how to balance current needs with the well-being of future generations and considers alternative energy sources as a means to mitigate the depletion of nonrenewable resources.