Using complete sentences, explain (in economic terms) the difference between scarcity and shortage.

Answer:

Scarcity is the basic economic condition in which resources are limited compared with people’s wants, so not all wants can be satisfied. It is ongoing and affects all societies. A shortage occurs when the quantity of a good or service supplied is less than the quantity people want to buy at a particular time and price. A shortage may be temporary, while scarcity is a persistent condition.