 What are the basic economic problems of any economy? Explain them briefly.

The economic problem –sometimes called basic or central economic problem – asserts that an

economy's finite resources are insufficient to satisfy all human wants and needs. It assumes that

human wants are unlimited, but the means to satisfy human wants are limited.

Examples of economic problems. The fundamental economic problem is the issue of scarcity –

but unlimited wants. Therefore, an underlying feature of economics is concerned with dealing

how to allocate resources in society to make the most efficient and fair use of resources.

Three Basic Economic Problems. Because of scarcity, every economy has to face three basic

economic problems: A. Since we do not have enough resources, we have to decide what types

and what quantities of goods are to be produced.

What are the 5 basic economic problems?

Scarcity, choice and the basic economic problem  Inflation, unemployment,

pollution, energy shortages and government deficits are some of the complex problems

confronting an economy, which have an impact at the micro level also.

Causes of economic problem:

The Problem of Allocation of Resources: ADVERTISEMENTS: The first and foremost

basic problem confronting an economy is “What to produce” so as to satisfy the wants of the

people. ... But because resources are in fact scarce relative to human wants, an economy must

choose among various goods and services.

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.