Scarcity
Definition. Scarcity is the fundamental economic problem that society has unlimited human wants but only limited resources, namely land, labour, capital, and enterprise, with which to satisfy them. Because resources are finite relative to wants, not all desires can be met and choices must be made.
Scarcity forces every economy to choose what to produce and forgo, which gives rise to opportunity cost. It is the reason resources have value and the starting point of all economic analysis.
This term belongs to Opportunity Cost in A Level Economics. Read the full chapter for the diagrams, worked examples and exam technique.
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