Question

In Economics, the 'central economic problem' means __________.

• A. consumers do not have as much money as they would wish
• B. there will always be a certain level of unemployment
• C. resources are not always allocated in an optimum way
• D. output is restricted to the limited availability of resources

Answer 1

Answer: (D)

output is restricted to the limited availability of resources

The central problems of an economy deals in the production of goods as resources are scarce so there is need to answer some questions where it is decide that :

• · What to produce? Consumer goods or capital goods?
  
• · How to produce? Using labour or capital?
  
• · For whom to produce? Rich people or poor people?