Describe a scarcity problem involving natural resources, time, or employees. What was scarce? Why was it scarce? Remember, it probably involved a tradeoff.

Company A sells hair products locally and globally however since they deal with natural hair products, they need to outsource some of the products. There has been a pandemic that has suspended all flights to and from destinations therefore, the supply of products has been cut off. The CEO decides that since the sales of running low and there is no more stock then some employees needed to be laid off. The pandemic had no specific time frame of when it would end but this greatly affected the situation with employees since the layoff would have to be temporary until stated otherwise or having the business closed (Gostin, 2020).

Sourcing for products locally would have been more expensive which would also lead to an increase in the price of the products. In this case, since customer service is also important, it only seems prudent to lay off the employees and sell the remaining stock until a new strategy is put in place to regrow the business. As much as this decision is tough, it is what is best for business to ensure that it keeps running. The criteria for choosing the employees who would stay included looking into the sales each employee has been making over the past six months. Lack of natural resources leads to a decrease in sales which translated to low revenue to sustain having salaries for them.


Gostin, L. O., & Wiley, L. F. (2020). Governmental public health powers during the COVID-19 pandemic: stay-at-home orders, business closures, and travel restrictions. Jama323(21), 2137-2138.

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