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August 18, 2017 

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SHORT RUN, MICROECONOMICS: In terms of the microeconomic analysis of production and supply, a period of time in which at least one input in the production process is variable and one is fixed. You should compare and contrast the short run with long-run production, very long run, and market period. In the microeconomic analysis, the short run is primarily used to analyze production decisions for a firm. In this context, the variable input is typically labor and the fixed input is capital. The short-run analysis of production reveals the law of diminishing marginal returns and provides an understanding of the upward-sloping supply curve and the law of supply.

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UNLIMITED WANTS AND NEEDS:

A basic condition of human existence which means that people are never totally satisfied with the quantity and variety of goods and services the consume. It means that people never get enough, that there's always something else that they would want or need. Unlimited wants and needs are one half of the fundamental problem of scarcity that has plagued humanity since the beginning of time. The other half of the scarcity problem is limited resources.
Unlimited wants and needs essentially means that people never get enough, that there is always something else that they would like to have.

For example, once Duncan Thurly eats a hearty breakfast of pancakes and sausage, is he satisfied? Perhaps. But then in a couple of hours he wants a tuna salad sandwich for lunch. Then he wants linguini with alfredo sauce and bottle of Chianti for dinner. And then wants a bedtime snack of chocolate chip cookies and milk.

Before long, the morning sun pops up and Duncan is hungry. It is breakfast time all over again. Quite obviously, no one EVER permanently satisfies that old hunger need.

What about other needs, like clothing, cars, or kitchen appliances. Once Duncan has a car, then he HAS a car and his car need is satisfied, right? The same can be said for other goods, right? Once Duncan has a can opener, then his can-opener need is satisfied, right?

This seems to imply that, in principle, Duncan could obtain every good that satisfies his assorted wants and needs. Perhaps. But once he has a car, then he needs gasoline, and motor oil, and insurance, and fuzzy dice to hang from the rear view mirror, and more gasoline, and new tires, and an oil change, and more gasoline, and... the list of needs goes on.

Wants or Needs

To understand why wants and needs are unlimited, consider the phrase "wants and needs." Wants and needs is the term for... well... wanting and needing things. Human people want some things like hot fudge sundaes and red sports cars. Human people need other things like food, water, and oxygen.
  • Needs: Needs are best thought of as physiological or biological requirements for maintaining life, such as the need for air, water, food, shelter, and sleep.

  • Wants: Wants are then the psychological desires that are not essential for life but that make life just a little more enjoyable.

Satisfaction

Now, consider the process of fulfilling wants and needs. Satisfaction is the process of successfully fulfilling wants and needs. Whether a good is wanted or needed, it provides satisfaction.

Consider the simple process of consuming a hot fudge sundae:

  • Duncan Thurly has a craving for a hot fudge sundae.
  • Duncan eats a hot fudge sundae.
  • Duncan no longer craves a hot fudge sundae.
  • Duncan has been satisfied, at least as far as his hot fudge sundae desire is concerned.

Motivation

The vast number of unsatisfied wants and needs is important because it provides people with the motivation to take action. Being hungry in the morning motivates Duncan to whip up some pancakes and sausage. Being hungry before bedtime motivates Duncan to seek out chocolate chip cookies. Similar motivations exist for lunch and dinner. Duncan buys a car because he needs to travel, Duncan buys a can-opener because he needs to open cans, Duncan buys clothing because he needs protection from the weather and does not want to hear people snicker when he passes by wearing nothing but sandals and a baseball cap.

For economics, the pursuit of satisfaction, the act of satisfying wants and needs, is extremely important. It motivates people to take action, to buy goods, to work, to produce, to consume. Duncan is motivated to buy a hot fudge sundae because he wants a hot fudge sundae. However, because wants and needs are unlimited, so too is his motivation to take action.

People always want and need more than they have. Throughout history, there is no documented case of anyone ever becoming fully, completely, and absolutely satisfied. Once Duncan eats a hot fudge sundae, then he needs stomach-settling antacid. Once he owns a red sports car, then he needs gasoline... and leather driving gloves... and sporty sun glasses... and fuzzy dice... and...

... and the list goes on. There is always something else that he wants or needs.

Unlimited wants and needs do not just motivate mundane activities such as these. They are ultimately responsible for motivating people to find employment, seek education, run for political office, explore new worlds, and well... just about everything else people do.

In fact, without unsatisfied wants and needs no one would ever do anything. No one would do anything because no one would NEED to do anything. Why bother doing anything when wants and needs are already satisfied.

Alternatives

One of the most important aspects of unlimited wants and needs is not so much the philosophical question whether or not wants and needs are ultimately limited or unlimited, but the pragmatic observation that the number of unsatisfied wants and needs is so vast that alternatives run rampant. Using resources to satisfy Duncan's car need, for example, means that his can-opener need, his cousin's clothing need, and a vast number of alternative needs remain unsatisfied.

Scarcity

When combined with limited resources, unlimited wants and needs results in the fundamental problem of scarcity.

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Recommended Citation:

UNLIMITED WANTS AND NEEDS, AmosWEB Encyclonomic WEB*pedia, http://www.AmosWEB.com, AmosWEB LLC, 2000-2017. [Accessed: August 18, 2017].


Check Out These Related Terms...

     | wants | needs | satisfaction |


Or For A Little Background...

     | scarcity | limited resources | first rule of scarcity | opportunity cost |


And For Further Study...

     | three questions of allocation | economics | dismal science | seven economic rules | resources | third estate | production possibilities | demand | market demand | utility analysis | utility | consumer demand theory |


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