Fundamental Problems of an Economy
Answers
The fundamental economic problem. The fundamental economic problem is related to the issue of scarcity. Because of limited resources and infinite demands, society needs to determine how to produce and distribute these relatively scarce resources.
Explanation:
India is the world's fourth-largest economy. It produced $9.4 trillion in goods and services in 2017. But it has a long way to go to beat the top three: China, with a production worth $23.1 trillion, the European Union with $19.9 trillion, and the United States with $17.4 trillion.
India had rapid growth despite the Great Recession. It grew 6.7% in 2017, 7.1% in 2016 and 8% in 2015. From 2008 through 2014, it grew between 5% and 11%. That phenomenal growth rate has reduced poverty by 10% in the last decade.
Prime Minister Nahrendra Modi is facing relection. He was elected on May 16, 2014, ending 60 years of leadership by the party led by Mahatma Gandhi. Mr. Modi, a successful businessman, promised to reduce bureaucracy and regulation, greenlight infrastructure projects, and simplify the tax code.
Opponents say he has not fulfilled his campaign pledges. Although growth rates were greater than 6% between 2014 and 2017, unemployment is still 8.5%. The government-owned banks had bad debt that reduced their ability to lend. The rupee declined through 2016, allowing 3.6% inflation.