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Economic and Free Market

Understanding the concept of Scarcity

Scarcity

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A foundational concepts of economics is scarcity. In Thomas Sowell’s word let as define “What does ‘scarce’ mean?

It means that people want more than there is.” In the words of my textbook, scarcity means “there is less of a good freely available from nature than people would like.”

Sowell again: “There has never been enough to satisfy everyone completely. That is what scarcity means.” Scarcity is not rareness: Cars are not rare; they are everywhere. But they are scarce nonetheless because not everyone who wants one has one, and not everyone who wants two has two.

To appreciate scarcity and its significance, focus on the scarcity of productive resources: the land, human talent, and capital goods—buildings, machinery, and equipment we require for producing what people want. We have unlimited desires for goods and services, but the land, labor, and capital available to produce them are all limited at any particular time. They are scarce. Accordingly, so are the goods and services we can produce with them.

This insight is at the heart of economics. Because there are not enough resources with which to produce everything we want at any time, we must decide how to allocate those resources and thereby decide to produce some goods instead of others. We constantly face such tradeoffs, because if we use resources to produce one thing, we can’t use them to produce another instead. How we make those choices (and, implicitly, who makes them) is what economics is about. As Sowell says, “Economics is the study of the use of scarce resources which have alternative uses.”

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Scarcity is a basic economic - gap between limited resources and theoretically limitless wants. Life was really made easier

How to present an Economics lesson to your class
First you must be prepare with a lesson plan to guide you through. Economics is not something to be taught without a proper preparation LydiaNJ (discuss • contribs) 16:33, 29 September 2022 (UTC)

One Disadvantage of free market economy is that some producers are driven exclusively by their profit motives.

Advantage of free market economics this type of economy leads to greater efficiency, productivity and innovation.