What is scarcity?

In business and economic terms, scarcity is any product or service where the available amount of supply cannot meet the existing demand. As an example, milk at a grocery store is a very common product and does not cost more than a few dollars for a gallon. However, if most of the world's dairy cows died off, nowhere near enough milk would be available to meet public demand, which would result in a scarcity and hugely elevated prices. Two historical examples of scarcity include gasoline during the 1970s oil crisis and alcohol during Prohibition.