Question

What is alternative use of resources and scarcity of resources?

Answer 1

Answer:

Thomas Sowell, the famous American economist credited Lionel Robbins - a British economist - with creating the classic definition of economics: “Economics is the study of the use of scarce resources which have alternative uses” Sowell stressed the fact that without scarcity, there is no need to economize - and therefore no economics.

It is generally true that our wants for scarce resources exceed the amounts that are available. In addition, resource s have more than one use and individuals wanting a resource must often compete with others who also want that particular resource for their own alternative use. For example, steel has alternative uses: to build cars, bridges, appliances, buildings, machinery, etc. It is also generally true that alternative resources can satisfy particular wants. A house can be constructed of steel, aluminum, wood, or glass (provided you don’t throw stones).

The pricing mechanism provides information to individuals to help them make decisions where they could most efficiently allocate their own scarce resource - money - when making choices regarding scarce resources. Using this information allows individuals to make informed rational decisions about their use of available resources and also helps to promote an efficient national economy.

Answer 2

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Everything available in our environment which can be used to satisfy our needs, provided, it is technologically accessible, economically . feasible and culturally acceptable can be termed as Resource. Examples, coal, water, air, minerals, etc