Scarci̇ty

SCARCİTY

Nevroz Gösterici

What causes scarcity?

1) Seemingly unlimited wants 2) Limited (Finite) Resources

Unlimited wants + Limited resources = SCARCITY

ECONOMICS

General economic theory = relies on assumption that resources are limited

General Definition: Study of people producing and exchanging to get the goods and services they want. It is a social science that describes and analyzes how society chooses among scarce resources to satisfy its unlimited wants.

BASIC ECONOMIC FLOW CHART

Limited ResourcesUnlimited Wants and Needs

SCARCITY

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FACTORS OF PRODUCTION

Resources = Basic elements used to produce goods and

services.

1. Natural Resources

2. Human Resources

3. Capital Resources

4. Entrepreneurship

1. NATURAL RESOURCES- “Gifts of Nature”- Air, sunlight, forests, earth, water and minerals are

all classified as land, as are all manner of natural forces or opportunities not created by humans. 

- Every tangible good is made of natural resources…implications?

2. HUMAN RESOURCES - “Labor” Taking natural

resources and exerting human force to fulfill our wants and needs

Converting Natural resources to human satisfactions

3. CAPITAL RESOURCES

Buildings, tools, and machines people use to produce other goods and services.

4. ENTREPRENEURSHIP

Imaginative thinking, willing to take risks, and the management and organizational skills needed to operate a business

Three Fundamental Questions

1. WHAT TO PRODUCE?

Fruits and veggies? Sugar Cane? Manufactured Goods?

Three Fundamental Questions

2. How to produce?Machines? Workers?Exploiting Children?Exploiting Workers

Abroad?

Three Fundamental Questions

3.For whom to produce? Developing world?Malnourished? Developed world?

Affluent societies?

Notice

Scarcity is not a Shortage!

A shortage occurs when a good or service is not being produced or offered in a given situation. It is not a permanent condition! It can be corrected as additional resources or

production becomes available. Scarcity is Permanent! Individuals will always want

more than they can have.

Thank you…