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Needs and wants are two important concepts in economics that help us understand consumer behaviour and the choices that people make..

A need is something that is essential for survival, such as food, water, clothing, and shelter. These are things that humans require in order to live and function properly. Needs are therefore considered to be necessities. A want, on the other hand, is something that people desire or wish to have, but that is not essential for survival. Wants are driven by personal preferences, tastes, and cultural factors. Examples of wants may include luxury goods, entertainment, travel, and other non-essential items..

In the context of IGCSE economics, understanding the difference between needs and wants is important because it helps us to understand how consumers make choices about what to buy and how much to spend. Consumers will typically prioritize their needs before their wants, meaning that they will first spend money on the things that are essential for survival before allocating any additional funds towards non-essential items..

However, the relative importance of needs and wants can vary depending on individual circumstances, such as income level, cultural background, and personal preferences. For example, a wealthy individual may prioritize their wants over their needs, whereas a person living in poverty may be forced to prioritize their needs above their wants..

In summary, needs and wants are two fundamental concepts in economics that help us understand how consumers make choices about what to buy and how much to spend. Needs are essential for survival, while wants are non-essential desires that are influenced by personal preferences and cultural factors..