Question

What is the most likely effect of a surplus of a trade good? Supply decreases. Demand decreases. Scarcity increases. Demand increases.

Answer 1

Answer:

Scarcity increases.

Explanation:

The “ scarcity increase” is the correct answer because the surplus in trade refers to the situation when the export of a country is greater than the import. Thus, when the export will be more, that means the supply is more and to supply more, the firms will use more inputs and raw materials. Since the resources are limited so increase in the use of raw material will increase the scarcity.