Answer :
Due
to the scarcity of resources and resources has alternative uses; we are facing
the Problem of choice. It is the problem of allocating scarce resources to
alternative uses.
For example: Land (a scarce
means of production) can be put to alternative uses, you can build factories on
it or construct houses or grow crops on it or covert it into a playground.
Problem of choice or the problem of allocation
of resources to alternative uses is the basic economic problem. This is the
root cause of emergence of economics as a subject matter of study.
Economics
is concerned with the study and solution of economic problems in a manner such that
the individuals (at micro levels) are able to maximize their gains, and the society
(at macro levels) as a whole is able to maximize its social welfare.
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