Scarcity
 

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Scarcity is the base of economics. From Scarcity we understand what is the problem and why do we need economics to solve it.In other words in life scarcityو is always the problem and economy the solution.


Scarce-Ethymology

Scarcity-Scarcity is when there are few resources to satisfy our unlimited wants and needs.


Needs- Essential eg.Food(Limited)

Wants-New cooler phone with 8GB memory card(Unlimited)

Human nature is such that we always want more. Don’t ask why. I am not a philosopher.


The truth hearts but if we want to use those resources we have to make a choice between our needs and wants. According to those choices we will use resources and satisfy some of our wants and forget about the other wants.


The wants that we will sacrifice are opportunity cost. If you have 10 bucks and you want credit for your phone and your stomach has been growling. You may choose not to eat and buy the credit due to some emergency and others may choose to eat and don’t buy the credit.So if you buy the credit, satisfaction from food is your opportunity cost and if you buy the food not having the power to call your friends is the opportunity cost.


Now in order to allocate resources in an efficient way to satisfy all of our wants we need the science of Economics.


We need economics to eat more, have more and spend more , as simple as that. Sounds materialistic but like it or not you have to pass this subject.

 

M.Ebrahim Sadeghian