Question

14. Which of the following is related to the problem 'for whom to produce'?
(4 Points)
Factor distribution of income
Inter-personal distribution of income
Both 1 and 2
None of these​

Answer 1

Answer:

The problem for whom to produce refers to selection of the category of people who will ultimately consume the goods. Since resources are scarce in every economy, no society can satisfy all the wants of its people. Thus, a problem of choice arises.

Explanation:

Production, exchange and consumption of goods and services are among the basic economic activities of life. In the course of these basic economic activities, every society has to face scarcity of resources and it is the scarcity of resources that gives rise to the problem of choice.

For whom to produce is one of the central problems of any economy and refers to the problem of how to distribute the produced goods and services among the individuals within the economy.

Who gets how much of the goods that are produced in the economy? How should the produce of the economy be distributed among the individuals in the economy? Who gets more and who gets less? Whether or not to ensure a minimum amount of consumption for everyone in the economy? Whether or not elementary education and basic health services should be available freely for everyone in the economy