Resources used in production 1. This leads all people around the world to scramble for the scarce resources and to rely on opportunity costs. What is opportunity Cost Abbott states clearly that opportunity costs can be termed as those choices that we either have to give up or to forgo for other choices that we feel are better.
What is Choice Choice can be referred to as the list of option or options that a person gives up for something else. Cunningham and William adds to this that if any of these two increases, there exists a more rapid expansion and growth of the economy. Labor is an important resource without which there would exist no production.
Labor Ashley and William state that labor is the time and physical or mental effort devoted by a group of people or a person in order to produce goods and services. The two further state that scarcity occurs in a situation where the quantity of the goods or resources demanded exceeds the quantity supplied.
There are other gifts of nature such as air, minerals and water that are useful for the purposes of producing goods and services to try and satisfy the diverse basic needs of man. According to Ashley and Williampeople normally make choices by comparing the benefits of one option with another option or by comparing all the options that are available and then choosing the one that they feel has the highest benefit to them.
The entrepreneurs are the people who set up a production industry by combining all factors of production in order to produce a good or service. Robert also adds that the increase in the monetary value carries with it a negative impact on the economy. Land Land is a natural resource which according to the bible, is given to us by God.
What needs to be done is to find ways of getting alternative resources so that the current economic crises are prevented.
Thus, all the other options are sacrificed. Because of the high demand and low supply, prices for even the essential commodities have inflated and made economies go down as a result.
This makes chances of investing slim and ensures low employment and production rate thus leading to a stall in the economic growth.
Because of the high costs and low income, we might not satisfy all our wants as we please and thus we make choices based on the theory of opportunity costs. It is for this reason that Abbott reasons that economics is sometimes called the study of scarcity.
The scarce amount of resources therefore require only a small percentage of manpower to control. He also adds that economic growth can also be termed as an increase in the total output of the economy which occurs when a society acquires new resources, or uses technology to produce more goods and services using existing resources.
Conclusion In conclusion, I can state that choice is brought about by the existence of scarce available resources. What is Scarcity According to Cunningham and Williamscarcity simply means that people require more goods and services than demand can provide.
When individuals or the society as a whole, choose more of something, scarcity ensures that there is little consumption of another thins. This leaves many people unemployed. Entrepreneurs These are the resources that organize other resources such as land, labor and capital. More Essay Examples on Economics Rubric 1.
This expansion in production under normal circumstances is usually caused by technological progress and Capital accumulation. Limited choices Cunningham and William also state in a very clear manner that where there is scarcity and choice, costs must be involved.
According to Robert, on his article entitled Scarcity and Choice, when this occurs, there are price increases or similar increases in the cost of production leading to an increase in monetary value of goods.
Limited employment opportunities Due to the fact that there exists only a limited number and quantity of resources, the number of employment opportunities also becomes limited.
Decrease in economic growth According to Robert Schenk n. This is because economic activities can never exist if scarcity never forced people to make choices. Thus, as Ashley and William say, the economic problems brought about due to scarcity and choices have existed with mankind from times immemorial and will escalate as the human population increases.
Choice is important in economics because it determines the scarcity of goods and services. This hinders economic growth Abbott A good example might be if you gave up the option of watching a television program in order to study thus the cost of studying can be compared to the relaxation you would have attained from watching the movie.
As also stated by Cunningham and Williamit is opportunity costs that normally lead to matters pertaining to scarcity and choice.
Because of this, Scarcity limits people because of limited income and yet very many need.The basic economic problem of scarcity refers to the situation in which finite factor inputs are insufficient to produce goods and services to satisfy infinite human wants.
It is incontrovertible and irrefutable that all societies face the basic problem of scarcity due to limited resources and unlimited wants.
In the chapter The Problem is Scarcity the author discusses the importance of economics, defines scarcity and opportunity cost and mentions the five basic economic questions. First, economics is important to study because it affects a person everyday in different ways and helps you make better economical choices/5(2).
Basic Economic problem of Scarcity Essay. A+. Pages:4 Words This is just a sample. To get a unique essay. The basic economic problem of scarcity refers to the situation in which finite factor inputs are insufficient to produce goods and services to satisfy infinite human wants.
The basic assumption of Economics is that all.
Scarcity is the fundamental economic problem of having humans who have unlimited wants and needs in a world of limited resources. It states that society has insufficient productive resources to fulfill all human wants and needs.
New Institutional Economics and the Philippines Essay More about Economic Problem in the Philippines. The. In economics, Scarcity means limitations that imply inadequacy or insufficiency in goods, resources and capacities through which desired goals are achieved.
It is considered to be a basic economic problem. The Economic Problem of Scarcity of Choice More Essay Examples on Economics Rubric. 1. It is universal that the available resources are insufficient to satisfy people’s needs thus the main economic problem is the appropriate use of limited resources to produce the .Download