Q 1 Discuss in detail the term economic resources with reference to service industry Explain the link between scarcity choice and opportunity cost?

Scarcity: the inability of economic actors to satisfy their wants and need to make trade-offs to achieve their optimal outcome.

Opportunity cost: the highest-valued alternative action forgone as the result of taking an action.

Link: scarcity implies all wants cannot be met. To meet our wants, we make trade-offs. Trade-offs involve opportunity costs because we must sacrifice alternatives outcomes for the rational (optimal outcome). Therefore, opportunity costs are the price we pay to trade-off in the condition of scarcity.