Question on: SS1 Economics - Concepts Of Wants, Scarcity, Scale Of Preference, Choice And Opportunity Cost
Which of the following best defines scarcity?
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A
The unlimited resources available to individuals to satisfy their needs.
B
The situation where the available resources are limited in relation to the wants or needs of individuals.
C
The list of wants or needs that an individual has, arranged in order of priority.
D
The act of selecting one option from several available alternatives.
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Correct Option: B
Scarcity is a fundamental concept in economics. It refers to the basic economic problem of having unlimited human wants and needs in a world of limited resources.
- Option A is incorrect because it describes the opposite of scarcity – unlimited resources.
- Option B correctly defines scarcity as the condition where resources are limited compared to the wants and needs.
- Option C describes a "want list," not scarcity.
- Option D describes "choice" or "opportunity cost", which is related to scarcity, but not the definition itself.
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