Question

1. Explain how scarcity and choice go together.​

Answer 1

Answer:

1. Explain how scarcity and choice go together.

Ans. Resources are not only scarce but also have alternative uses. Thus, land can be used for producing wheat or for constructing warehouses or factories. Hence, the problem of choice is the essence of any economic problem. However, if resources were not scarce, one could have anything any time and there would be no problem of choice.

Answer 2

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• Scarcity of resources gives rise to the fundamental economic problem of choice. As a society cannot produce enough goods and services to satisfy all the wants of its people, it has to make choices. Choices or alternatives are illustrated in terms of a production possibility curve.