Understanding The Economic Behaviour Of A Uk Based Organisation
The problem of scarcity and demand resource allocation in managing an economy with example drawn from UK economy.
The Basic Problem – Scarcity.
Scarcity is one of the most basic economic problems that have to do with limited resources available to unlimited want of a society. In order to solve the problem choice has to come to play in order to make a decision and trade-off others. As scarcity of the allocation resources have to be managed efficiently.
There are four basics of resources which are needed namely, labour which is based on the physical and mental effort; finance is the man made tools of production; physical resources which are land, offices and transportation; technology which are based on heavy machinery. Tesco as a retail stores which sells various goods will like to sell some pairs of jeans which have to come from a supplier to the stores. As the resources are very scarce, to mention precisely the finance that has to be carefully managed. However Tesco will still have to make sure that the jeans are affordable to determine how much the consumers are prepared to pay for each jeans at Tesco profitable level, in order to do so equilibrium method will now come to play to know the agreed point in price, whereby wherever the price and quantities demanded meet is called equilibrium point.
The equilibrium is where the demand and supply curves meet…