Question

Explain the economic problem "how to produce"?​

Answer 1

Three Basic Economic Problems. All modern economies have certain fundamental or basic economic problems to deal with. In every single economy, including the so-called “affluent society”, resources are limited.

Answer 2

What to Produce: This problem involves selection of goods and services to be produced and the quantity to be produced of each selected commodity. Every economy has limited resources and thus, cannot produce all the goods. More of one good or service usually means less of others.