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| 1. |
Explain the problem of 'what to produce’. |
| Answer» <html><body><p></p>Solution :As there is the problem of choice, the <a href="https://interviewquestions.tuteehub.com/tag/economy-21801" style="font-weight:bold;" target="_blank" title="Click to know more about ECONOMY">ECONOMY</a> has to decide which <a href="https://interviewquestions.tuteehub.com/tag/goods-1009877" style="font-weight:bold;" target="_blank" title="Click to know more about GOODS">GOODS</a> and services are to be produced. For example, which of the consumer goods such as wheat, rice, cloth are to be produced and which of the capital goods such as <a href="https://interviewquestions.tuteehub.com/tag/machines-550361" style="font-weight:bold;" target="_blank" title="Click to know more about MACHINES">MACHINES</a> and tools are to be produced.When an economy has taken a decision as to what goods or services to be produced, then it has to be about its <a href="https://interviewquestions.tuteehub.com/tag/quantity-1174212" style="font-weight:bold;" target="_blank" title="Click to know more about QUANTITY">QUANTITY</a>. How <a href="https://interviewquestions.tuteehub.com/tag/much-2164829" style="font-weight:bold;" target="_blank" title="Click to know more about MUCH">MUCH</a> of consumer goods and capital goods are to be produced.For example, if an economy decides to produce rice and wheat within a given period with limited resources then it will have to use less of machineries.</body></html> | |