Economic assigment?

Question

1. Why both rich and poor experience scarcity?

2. Two customers go to the fish counter at a supermarket to buy some fish. Neither looks at the price. Customer A orders 1 kilo. Customer B orders RM30 worth. What is the price elasticity of demand for fish of each of the two customers?

Answer 1

1. Because scarcity relates to there being only a finite number of goods obtainable, whether you are rich or poor, once the goods are gone they are gone.

2. Is a bit of a trick question. The key is that neither customer looked at the price (i.e. they didn't care about price) they just wanted fish and apparently were willing to pay any price. That means their price elasticity of demand is perfectly inelastic which means it is equal to zero.