The Economic Problem What goods and services should an economy produce? – Should the emphasis be on agriculture, manufacturing or services, should it be on sport and leisure or housing? How should goods and services be produced? – Labour intensive, land intensive, capital intensive? Efficiency? Who should get the goods and services produced? – Even distribution? More for the rich? For those who work hard? Economic problem reveals that: People have unlimited Wants. You want a TV set today, tomorrow a car. Scarce Resources – Land, Labour, Capital. The means or recourses to produce your needs and wants are scares. Resource Use – scarce resources have alternative use. With your pocket money (scarce resource) you can choose to save it or spent it on sweets. Choices – the process of choosing between two alternatives. Choosing between saving and spending involves a very special cost, i.e. opportunity cost. Read More »
Economic problem reveals that:
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