<h2>What is Economics, and Why is It Important?</h2>
<p><strong>Economics</strong> is the study of how humans make decisions in the face of scarcity. These can be individual decisions, family decisions, business decisions or societal decisions. If you look around carefully, you will see that scarcity is a fact of life. <strong>Scarcity</strong> means that human wants for goods, services and resources exceed what is available. Resources, such as labor, tools, land, and raw materials are necessary to produce the goods and services we want but they exist in limited supply. Of course, the ultimate scarce resource is time- everyone, rich or poor, has just 24 hours in the day to try to acquire the goods they want. At any point in time, there is only a finite amount of resources available.</p>
<p>Think about it this way: In 2015 the labor force in the United States contained over 158.6 million workers, according to the U.S. Bureau of Labor Statistics. Similarly, the total area of the United States is 3,794,101 square miles. These are large numbers for such crucial resources, however, they are limited. Because these resources are limited, so are the numbers of goods and services we produce with them. Combine this with the fact that human wants seem to be virtually infinite, and you can see why scarcity is a problem.</p>
<div class="fig_container" id="CNX_Econ_C01_003">
<h3 data-type="title">Scarcity of Resources</h3>
<div class="wp-caption alignnone" style="width: 390px"><img alt="The image is a photograph of two people who are homeless and sleeping on public city benches." height="293" src="https://data.ulearngo.com/assets/1998362f-1522-45a8-b72d-c6a874178224" width="390"/><p class="wp-caption-text">Homeless people are a stark reminder that scarcity of resources is real. (Credit: “daveynin”/Flickr Creative Commons)</p></div>
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<p>If you still do not believe that scarcity is a problem, consider the following: Does everyone need food to eat? Does everyone need a decent place to live? Does everyone have access to healthcare? In every country in the world, there are people who are hungry, homeless (for example, those who call park benches their beds, as shown in <a href="#CNX_Econ_C01_003">this figure</a>), and in need of healthcare, just to focus on a few critical goods and services. Why is this the case? It is because of scarcity. Let’s delve into the concept of scarcity a little deeper, because it is crucial to understanding economics.</p>

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What is Economics, and Why is It Important?

Economics studies social behavior guiding the allocation of scarce resources to meet the unlimited needs and desires of the individual members of a given society, and for the production of goods and services, growth of production and welfare over time, and a great variety of other complex issues of vital concern to society. 

Economics

Learn about the fundamental concepts and theories in economics, including scarcity, specialization, trade, and the use of models to understand economic issues, as well as the history and importance of the subject in today&#8217;s globalized world.


What is Economics, and Why is It Important?

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