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Introduction of Micro-Economics — Economics STD 12 Humanities & Commerce — Question

Rajasthan BoardEnglish MediumSTD 12 Humanities & CommerceEconomicsIntroduction of Micro-Economics3 Marks
Question
Why does an economic problem arise?###State any two causes of economic problem.###State two characteristics of the economic resources which give rise to economic problem.###hy does problem of choice arise?###Explain three factors that lead to an economic problem.
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Answer

Economic problem arises because of scarcity of resources in relation to demand for them.
  1. Wants are unlimited:
  1. This is a basic fact of human life. Human wants are unlimited.
  2. They are not only unlimited but also grow and multiply very fast.
  1. Resources are limited:
  1. The resources to produce goods and services to satisfy human wants are available in limited quantities. Land, labour, capital and entrepreneurship are the basic scarce resources.
  2. These resources are available in limited quantities in every economy, big or small, developed or underdeveloped, rich or poor. Some economies may have more of one or two resources but not all the resources.
  3. For example, Indian economy has relatively more labour but less capital and land. The U.S. economy has relatively more land but less labour. No economy in the world is comfortable in all the resources.
  1. Resources have alternative uses:
  1. Generally a resource has many alternative uses.
  2. A worker can be employed in a factory, in a school, in a government office, self employed and so on.
  3. Like this, nearly all resources have alternative uses. But the problem is that which resource should be put to which use.

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