Figure 5.1. The figure shows a linear production possibility curve representing a tradeoff faced by a country, between necessities and luxuries.
-To say that "there is a scarcity of gold" means that:
A)gold prices will plummet.
B)there is not enough gold to satisfy people's demand.
C)there are a very few substitutes for gold.
D)gold is relatively less expensive than other metals.
E)the demand for gold is changing.

Question

Figure 5.1. The figure shows a linear production possibility curve representing a tradeoff faced by a country, between necessities and luxuries​. 
-To say that "there is a scarcity of gold" means that:
A)gold prices will plummet. 
B)there is not enough gold to satisfy people's demand. 
C)there are a very few substitutes for gold. 
D)gold is relatively less expensive than other metals. 
E)the demand for gold is changing.

Quizplus · Accepted Answer

Scarcity refers to a situation when the available resources are insufficient to satisfy all the wants and needs of people. Therefore, if there is a scarcity of gold, it means that there is not enough gold to satisfy people's demand, hence the best answer is B. Option A and D are incorrect as they talk about the price of gold, which is not necessarily related to its scarcity. Option C is partially correct, but it does not fully capture the meaning of scarcity. Option E is irrelevant to the question as it talks about changes in demand, not scarcity.

Figure 51 the Figure Shows a Linear Production Possibility Curve Representing