What Is the Difference Between a Shortage and Scarcity

question 225

Essay

What is the difference between a shortage and scarcity?
A.Scarcity will almost always exist, but a shortage will exist only if the price is kept below the equilibrium level.
B.Scarcity is a result of two or more alternative uses, and quantities of supply and demand adjusting to flexible prices will create shortages.
C.A shortage will exist when a good is scarce.
D.There is no distinction between the two.
E.They are the same thing.

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Definitions:

Direct Cost

Expenses that can be directly attributed to the production of specific goods or services, like raw materials and labor.

Initial Direct Costs

Expenses directly associated with acquiring or originating a loan or insurance policy, which may include processing and sales commissions.

Revenue Recognized

The process of recording revenues in the financial statements when they are earned, which may not coincide with when the cash is received.

Collectibility

The likelihood or ability of a company to collect its accounts receivable from customers.