This basic economic question is focused on who receives what share of the products and services which the economy produces. The portion of production which each person and family can consume is determined by their income. Income is distributed in line with the value of resources we have to sell. As an example, a top cricket player will earn far more income than a professor. A top cricket player has a resource to sell for which many people will pay a high price. Professors are not so rare, and few people pay for their services. The for whom decision can even be dependent upon skills shortages, in which case organizations will provide higher incomes to attract workers with rare skills. In the same way, high wages may be required to attract employees to rural locations.
The economic problem is at times referred to as the basic, central or fundamental economic problem. It is one of the crucial economic theories in the functioning of any economy in this world. Due to scarcity, choices have to be made by consumers, businesses and governments. Scarcity can be caused by the possible lack of availability in resources, from individual’s insatiable desires, or from a combination of the two. Due to the fact that resources are scarce and many of our desires are substantial, a choice needs to be made about how to use scarce resources in the most effective way. This rule is applicable to companies, society as a whole, and to individuals. This article has discussed the 3 fundamental economic questions or three basic economic problems of society. If anything is missing please post in the comments section.
