Final answer:
Scarcity leads to reduced choices for businesses because limited resources require prioritization and strategic decision-making, highlighting the importance of efficient resource allocation.A
Step-by-step explanation:
Scarcity is a fundamental concept in business and economics, which refers to the limited availability of resources such as labor, materials, and time.
It is because of scarcity that businesses must make decisions on how to allocate their limited resources for the best possible outcomes. Scarcity affects the choices a business makes in both resources and production by limiting the options available and increasing the cost of those resources.
As resources become scarcer, a business might find its choices reduced, forcing it to make tough decisions about what to produce, how to produce, and what can be sacrificed. Therefore, given the options A) Increases choices B) Decreases choices C) No effect on choices D) Redefines choices, scarcity decreases choices a business can make in terms of resources and production. In summary, scarcity compels businesses to prioritize certain activities over others due to the limited nature of resources.