Question

Scarcity is the undercurrent of economic problem and therefore of economics how?

Answer 1

Scarcity is our limited resources but unlimited wants. Our resources are limited by the 4 factors of production - land, labour, capital and enterprise.

The problem of scarcity is that our wants are always beyond what we can produce with our resources.

Scarcity is the root of all economic problems. Had there been no scarcity of resources, there would have no economic problems and we would not have studied economics either.

Answer 2

It is the undercurrent as all human wants can not be satisfied.

• There are only a limited number of resources or ways to satisfy all of the demands that humans have.
• Not all human desires can be met with the resources at hand. The issue of scarcity results from this.
• Economics is concerned with the distribution of limited resources to satisfy people's endless wants in a world of scarcity.
• The issue of scarcity affects all economies and is a universal one.
• Thus, one of the primary motivations for studying economics is the concept of scarcity and how resources might be used most effectively to serve human needs.
• As a result, it can be asserted that economics is driven by a sense of scarcity.

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