When we apply the principle of scarcity on our life, we realize that time is our scarce most resource and is non renewable. I can't increase my life by one second by spending my entire wealth. Therefore, I must make best possible use of my time. It teaches us efficiency, optimum utilization, no wastage, rationality and decision making by cost-benefit analysis.

Some recent definitions have been called growth definitions. According to Professor Henry Smith, "Economics is the study of how in a civilized society one obtains the share of what other people have produced and of how the total product of society changes and is determined." According to Jacob Viner, "Economics is what economists do." According to Paul A Samuelson, "Economics is the study of how men and society choose, with or without the use of money, to employ scarce productive resources which could have alternative uses, to produce various commodities over time and distribute them for consumption now and in future amongst various people and groups of society."

Had there been no scarcity, there would have been no need for optimizing the resources. But the fact is that resources are scarce in relation to unlimited human wants and therefore, we need to optimize their utilization so as to maximize our utility level. It is used for decisions at individual as well as society level. Had there been no scarcity, there would have been no problem of making a choice. We need not make choice in case of abundant things. Therefore, it is right to say that scarcity and choice go together.

Consumption: Consumption deals with satisfaction of human wants. It is an economic activity which deals with the use of goods and services for the satisfaction of human wants. For example, if you are feeling hot and when you use fan, it gives you satisfaction in the form of comfort, you are consuming electricity. Production: Production includes all those activities which are undertaken to produce goods and services for generation of income by enhancing utility of goods and services. It is the process which adds to the level of utility. For example, when wood is converted into furniture, it increases the worth of wood. Similarly, transport creates place utility by taking goods or persons from place where their utility is less to places where their utility is more. For the production of any goods and services, a person needs land, labour, capital and entrepreneur.
Distribution: Distribution is that economic activity which studies how income generated is distributed amongst different factors of production of land, labour, capital and entrepreneur in the form of rent, wages, interest and profits. It studies if income is distributed equally or unequally.

Scarcity Definition was given by Robbins. According to him, "Economics is the science which studies human behaviour as a relationship between ends and scarce means which have alternative uses." Critical Evaluation of Scarcity Definition: Robbins defined economics as neutral between ends and declaring economists to be least bothered about values and welfare. Robbins' definition of economics does not cover the aspects of economic growth and economic development. Problem of unemployment is not a problem of scarcity but a problem of abundance of manpower. It has reduced the scope of economics only to allocation of resources.

Economics is required in all spheres of life.
(a) As a Consumer: All of us have a limited income and we wish to satisfy our unlimited wants from it. Economics helps us to take optimum decisions regarding consumption and allocation of income to different goods and services.
(b) As a Producer: A producer wants to produce his goods and services in such a way that his cost is least and profits are most. Economics gives such principles which help him to attain such a combination.
(c) As an Investor: As an investor, we need to invest our funds in such a venture which give us maximum returns with minimum risk. Once again Economics gives such principles which help him to attain such a combination.
(d) As a Citizen: As a citizen, Economics helps us to understand the impact of Government policies on our society and economy. Accordingly, we can say if government is working efficiently or not.
(e) As a human being: When we apply the principle of scarcity on our life, we realize that time is our scarce most resource and is non-renewable. We can't increase our life by one second by spending our entire wealth. Therefore, we must make best possible use of our time. It teaches us efficiency, optimum utilization, no wastage, rationality and decision making by cost-benefit analysis. What are vital economic activities?

Problems of choice is unavoidable in the ordinary business of life because of following reasons.
1. Unlimited Wants: Human wants are unlimited. The moment one want is satisfied other one creeps up. It is a never-ending phenomenon both in quantitative and qualitative terms. An important thing to note is that however, wants are unlimited but they vary in their intensity. It is because of this variation in intensity that people are able to allocate the resources to satisfy their some wants. 2. Scarce Means: Means to satisfy human wants are scarce. Had means been unlimited, there would have been no economic problem at all. Resources being limited, all wants can not be satisfied; then the problem of prioritizing the wants arises.
3. Means have alternative uses: Economic resources can be put to various uses. Like a piece of land can be used for agriculture, school, hospital or residential building. It is because of alternative uses of resources that we have to decide about best allocation of resources.

Marshall pointed out that wealth is not an end in itself; but it is only a means to an end; end being promotion of human welfare. Thus, according to Marshall, wealth is only a secondary thing; it is man and his ordinary business of life which is the primary object of economic study. According to Alfred Marshall, Economics is the study of mankind in the ordinary business of life. It examines that part of individual and social action which is most closely connected with the attainment and with the use of the material requisites of well being. Thus, it is one side of the study of wealth and more important side is a part of study of the man. According to A. C. Pigou "The range of our enquiry becomes restricted to that part of social welfare that can be brought directly or indirectly into relation with the measuring rod of money." According to Cannan, "The aim of Political Economy is the explanation of the general causes on which the material welfare of the human being depends". 
Critical Evaluation of the Welfare Definition:
Economics studies not only material things but also non-material things.
1. Welfare is a subjective thing and varies from person to person.
2. Goods like liquor, opium and cigarettes etc are harmful to health but are studied in economics as they are scarce in relation to demand for them.

Pioneers of the science of economics defined it as a science of wealth. Adam Smith who is known as father of economics in his famous book on economics "An Enquiry into the Nature and Causes of Wealth of Nations", defined economics as. "Economics enquires into the causes that determine the wealth of a country and its growth." According to J B Say "Economics is a science which deals with wealth." According to F A Walker, "Economics is the name of that part of knowledge which relates to wealth".
Critical Evaluation of the wealth definition:
(a) It ignored immaterial things such as education, health etc outside the definition of wealth and therefore beyond the bounds of economic wealth.
(b) It ignored many aspects of economics like welfare and social justification.
(c) They also showed a biased attitude by regarding rights to private property or wealth as natural and moral rights.