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Answer on Economics of Enterprise Question for kamales

Question #1563

How does the study of economics depend upon the phenomenon of scarcity?

Expert's answer

Scarcity in the economy is the excess of demand over supply. Scarcity shows a discrepancy between supply and demand and the absence of countervailing prices.
Study of economics depends on existence of scarcity. The phenomenon of scarcity determines the development of new trends and theories that enable you to analyze and control the economy in the scarcity. Great importance has the deficit to achieve government goals and improve the economic situation in the country. Effective management allows minimizing public costs and losses and getting more profits.
The phenomenon of scarcity leads to appear of notion of budget scarcity or good scarcity. And this leads to creating the theories for studying, regulating, using and overcoming the relevant phenomena
The phenomenon of scarcity is another element of the economy and allows you to explore it (economy) in all its integrity and versatility


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