Podcast
Questions and Answers
What is the primary test to determine if air is scarce?
What is the primary test to determine if air is scarce?
- Whether it has alternative uses (correct)
- Whether it is essential for breathing
- Whether it can be polluted
- Whether it can be bought or sold
What is an example of a free good mentioned in the content?
What is an example of a free good mentioned in the content?
- Gravity (correct)
- Outer space
- Water
- Clean air
What happens when we decide we want to breathe cleaner air?
What happens when we decide we want to breathe cleaner air?
- We start using more air to breathe
- We start using more pollution-generating activities
- We limit the activities that generate pollution (correct)
- We start selling clean air
Why does outer space become scarce?
Why does outer space become scarce?
What is the result of one person's use of gravity on another person's use?
What is the result of one person's use of gravity on another person's use?
What is the scope of economics according to the content?
What is the scope of economics according to the content?
What is the main reason we have to make choices?
What is the main reason we have to make choices?
What is the definition of scarcity?
What is the definition of scarcity?
What is an example of a scarce good?
What is an example of a scarce good?
Why can't we say 'yes' to everything we want?
Why can't we say 'yes' to everything we want?
What is an alternative use of a parcel of land?
What is an alternative use of a parcel of land?
Why is it necessary for society to make choices concerning the use of land?
Why is it necessary for society to make choices concerning the use of land?
What is an implication of scarcity?
What is an implication of scarcity?
Is air an example of a scarce resource?
Is air an example of a scarce resource?
Flashcards
Scarcity
Scarcity
Having limited resources available to meet unlimited wants, forcing choices to be made.
Free Good
Free Good
A resource that is abundant and freely available to everyone, without diminishing its availability for others.
Scarce Good
Scarce Good
A resource that is limited in supply and has alternative uses, requiring choices to be made.
Making Choices
Making Choices
The unavoidable situation of having to choose between alternatives due to limited resources.
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Economics
Economics
The study of how individuals and societies make choices under scarcity, allocating limited resources to satisfy unlimited wants.
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Use of Resources
Use of Resources
The ability to use a resource for a specific purpose, for example, using land for farming or construction.
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Alternative Uses
Alternative Uses
The impact of one person's use of a resource on the ability of another person to use the same resource.
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Non-Rivalrous Good
Non-Rivalrous Good
The idea that one person's action with a resource does not affect another person's ability to use it.
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Limiting Pollution
Limiting Pollution
The process of restricting activities that negatively impact the environment, such as pollution.
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Opportunity Cost
Opportunity Cost
Determining whether an action is worth the cost by comparing its benefits to its drawbacks.
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Scarce Resources
Scarce Resources
Resources that are limited in supply and can be used in different ways.
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Innovation and Scarcity
Innovation and Scarcity
The process of creating new uses or value for resources, leading to increased demand and potential scarcity.
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Expanding Resources
Expanding Resources
The process of finding new ways to use previously unused or undervalued resources, making them scarce.
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Scarcity and Wants
Scarcity and Wants
The idea that resources are scarce because our wants are unlimited, leading to choices and trade-offs.
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Scarcity, Choice, and Cost
- All choices involve selecting one alternative over another, which is central to economics.
- Scarcity is the condition of having to choose among alternatives due to limited resources.
- Unlimited wants (desires for goods and services) collide with limited resources, forcing us to make choices.
- A scarce good is one for which the choice of one alternative requires giving up another.
Scarce Goods and Alternative Uses
- Land is a scarce good with alternative uses (e.g., housing, gas station, park, or leaving it undeveloped).
- The choice of one use for land means giving up another use (e.g., if the Lees live in the house, the Nguyens cannot).
- Virtually everything is scarce due to alternative uses (e.g., air for breathing and as a garbage dump).
Free Goods and Alternative Uses
- A free good is one for which the choice of one use does not require giving up another.
- Examples of free goods are rare, but include gravity, where one person's use does not affect another's use.
- Outer space was once a free good but is now becoming scarce due to increased use (e.g., allocation of orbital slots for communications satellites).
Implications of Scarcity
- Scarcity characterizes virtually everything, making the scope of economics extensive.
- Economics is necessary because our unlimited wants collide with limited resources, forcing us to make choices.
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