Answer to Question #60191 in Microeconomics for Roop Singh Kunwar

Question

Scarcity and Choice go together . Explain?

Answer 1

Scarcity means that people want more than is available according to some reasons as limited resources or abilities. Scarcity limits us both as individuals and as a society. As individuals, limited income, time and ability keep us from doing and having all that we might like. As a society, limited resources (such as manpower, machinery, and natural resources) fix a maximum on the amount of goods and services that can be produced at some level of technology development.
Scarcity requires choice. People must choose which of their desires they will satisfy and which they will leave unsatisfied. When we choose more of something, scarcity forces us to take less of something else. Economics is sometimes called the study of scarcity because economic activity would not exist if scarcity did not force people to make choices.