ABSTRACT
Each of the factors of production has a price, as do the raw materials which each organization uses.
In simple terms, the more abundant the factor or material, the less it will cost. The scarcer it becomes, the more expensive it becomes. If there is no market for it, i.e. if no one wants it, then scarcity will have little
or no effect on price. For example, if fur-bearing animals are scarce, but people give up wearing fur for ethical reasons, then the price of fur will not be high.
