Praxis English Language Arts and Social Studies (5154) Practice Test

Scarcity makes a good more valuable because there isn’t enough to go around. This is explained by supply and demand: demand is how much people want the good at different prices, and supply is how much producers are willing to offer. When something is scarce and still in high demand, the market price tends to rise as buyers compete. The higher price signals producers to supply more and can push some buyers away, moving the market toward an equilibrium price and quantity. For example, limited edition sneakers or scarce concert tickets become more expensive as demand outstrips supply.