What Is the Difference Between a Shortage and Scarcity

question 70

Multiple Choice

What is the difference between a shortage and scarcity?

• A) Scarcity will always exist because choices must be made, but a shortage will only exist if the price is kept below the equilibrium level.
• B) Scarcity is a result of two or more alternative uses and will always exist, and quantities of supply and demand adjusting to flexible prices will create shortages.
• C) A surplus will exist when a good is scarce; a shortage merely implies that there isn't as much of something as people would like, which is nearly always the case.
• D) There is no distinction between the two.They are the same thing.

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Definitions:

Product

An item or service created through a process and offered in the market to satisfy a need or desire.

Divisional Structure

An organizational layout where operations are grouped based on divisions, which could be product lines, geographical areas, or customer markets.

Functional Structure

An organizational structure where the company is divided into departments based on their functions, such as marketing, operations, and finance.

Geographic Location

The specific physical position of something on the Earth's surface, determined by its latitude, longitude, and other factors.