To Discuss:
Problem of Scarcity.
Answer to Problem 2.1LO
Scarcity exists in every society and at all income levels because the human wants exceed the available resources.
Explanation of Solution
The available resources are limited and have multiple uses with which whatever we can produce is not enough to satisfy the human wants.
Scarcity is the central problem of economy which gives birth to the problem of choice due to which the economy has to decide what to produce, how to produce, and for whom to produce.
Introduction:
The problem of choice arises due to problem of scarcity which states that the factors of production are limited but the wants are unlimited.
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