Question

Why are all resources considered scarce and how does scarcity affect economic decisions? In your response, be sure to define and explain how opportunity cost, efficiency, and thinking at the margin connect to scarcity.

Answer 1

Scarcity is one of the most significant factors that influence supply and demand. The scarcity of goods plays a significant role in affecting competition in any price-based market. Because scarce goods are typically subject to greater demand, they often command higher prices as well

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