BUSINESS ADMINISTRATION
BUSINESS ECONOMICS
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Question
[CLICK ON ANY CHOICE TO KNOW THE RIGHT ANSWER]
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What goods are to be produced?
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What quantities of goods are to be produced?
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Both (1) and (2)
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Neither (1) Nor (2)
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Detailed explanation-1: -The problem of ‘what to produce’ deals with the production of necessary goods that have demand in the economy which can be evenly distributed so that social as well as economic stability is maintained in the economy.
Detailed explanation-2: -Central problem of choice of technique refers to the problem of how to produce. Every society has to decide on how much of which of the resources to use in the production of each of the different goods and services. Whether to use more labour or more machines.
Detailed explanation-3: -This refers to different aspects of production from selecting which raw materials to be used, what technique of production has to be adopted, and where these goods would be produced. How means deciding the manner in which the goods are produced largely deals with deciding what amount of labor would be involved.
Detailed explanation-4: -The problem for whom to produce refers to selection of the category of people who will ultimately consume the goods. Since resources are scarce in every economy, no society can satisfy all the wants of its people. Thus, a problem of choice arises.