what is economic problem?
Economic problem is the problem of choice arising out of limited availability of resources as against unlimited human wants. No matter how well an economy is endowed with resources, these resources will always be relatively scarce to fulfill its unlimited wants. Moreover, these resources have alternative uses and can be allocated to the production of different goods and services. As the resources are scarce they can be allocated to only some particular use while sacrificing other possible uses. Thus, an economy must make a choice as to where to allocate the resources so as to fulfill the different and competing wants in the best possible manner.