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Microeconomics, scarcity.

a student once concluded that oil must not be scarce in saudi arabia because of that nation's vast oil reserves. Explain why you should agree or disagree with the student's conclusion.

Posted in Economics, asked by Brianna, 6 years ago. 1938 hits.

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The fact that oil is a scarce commodity is viewed in relative terms of demand and availability in a given location. Yes in Saudi Arabia, which is oil rich country the availability of oil maybe more than the demand from  its own residents, hence oil is not scarce there.

However, from the global perspective, oil is a scarce commodity in relative terms. Because of unlimited human wants the world  demand for oil far outstrips the global availability, so there exists oil scarcity.

Venkata Aluri
Venkata Aluri - 6 years ago
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