Log out Go to App
Go to App

Learning Materials

Features

Discover

Chapter 2: Q8 (page 43)

Explain why scarcity leads to tradeoffs.

Short Answer

Expert verified

Scarcity ie supply shortage compared to demand, and resources alternative uses - lead to the problem of economic choice & hence trade offs.

Step by step solution

01

Scarcity Concept 

Scarcity means Shortage.

It is the shortage of resources' supply in comparison to their demand. It is an implication of resources being limited, in contrast to unlimited human wants.

02

Trade off Concept 

Trade off means problem of choice, needing to sacrifice one commodity in order to gain another commodity.

It arises due to scarcity issue, coupled up with the fact that the limited resources have alternative uses.

Unlock Step-by-Step Solutions & Ace Your Exams!

  • Full Textbook Solutions

    Get detailed explanations and key concepts

  • Unlimited Al creation

    Al flashcards, explanations, exams and more...

  • Ads-free access

    To over 500 millions flashcards

  • Money-back guarantee

    We refund you if you fail your exam.

Start your free trial

Over 30 million students worldwide already upgrade their learning with Vaia!

One App. One Place for Learning.

All the tools & learning materials you need for study success - in one app.

Get started for free

Most popular questions from this chapter

Would an op-ed piece in a newspaper urging the adoption of a particular economic policy be a positive or normative statement?

Explain why societies cannot make a choice above their production possibilities frontier and should not make a choice below it.

What assumptions about the economy must be true for the invisible hand to work? To what extent are those assumptions valid in the real world?

Do economists have any particular expertise at making normative arguments? In other words, they have expertise at making positive statements (i.e., what will happen) about some economic policy, for example, but

do they have special expertise to judge whether or not

the policy should be undertaken?

What are the similarities between a consumer’s budget constraint and society’s production possibilities frontier, not just graphically but analytically?
See all solutions

What do you think about this solution?

We value your feedback to improve our textbook solutions.

Study anywhere. Anytime. Across all devices.

Sign-up for free