1. Living in a World of Scarcity
Consequences of Living in a World
of Limited Resources

2. We Live in a World of Scarcity
We have unlimited wants, but our resources are limited
As a result of scarcity, we need to make choices about how we use our limited resources

3. We Live in a World of Scarcity
Opportunity Cost
The most valued opportunity or alternative we give up when we make a choice
Example
When I went to the store I saw a blue tie and a red tie that I wanted to buy. I chose the red tie - so the opportunity cost of that decision was not having the blue tie

4. Consequences of Scarcity - The Need for a Rationing Device
Because of scarcity, a rationing device is needed to determine who gets what portion of all the resources and goods available
In most societies, money is used as a rationing device

5. Consequences of Scarcity -
Competition
Because people compete for the rationing device, competition is a consequence of scarcity
In a competitive world some people do very well, others do okay, others do quite poorly