Practice question · Multiple choice
A country discovers vast oil reserves and its citizens still face trade-offs. Which reading of scarcity does that support?
Hints
- Ask what would have to be true of wants for scarcity to disappear.
- The country got richer. Did it get more hours in the day?
Show the answer
A. Scarcity is the gap between wants and means, not a quantity
Why
Wants expand to meet whatever means arrive, so more resources buy a better menu rather than an end to choosing. This is why economics is not the study of poverty and why it applies just as sharply to a rich country's budget debate as to a poor one's.
Practise Scarcity
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