What implications does the resource Scarcity of economy have?
Options
APolitical problems
BEconomic problems
CGeographical problems
DCultural problems
For any discrepancies in this question, email contact@cadada.in
Introduction to Business EconomicsPYQ Dec 23Question 569 of 209
All Questions Correct Answer
✅ Option b — Economic problems
All Options:
- APolitical problems
- BEconomic problems
- CGeographical problems
- DCultural problems
Detailed Solution & Explanation
• Resource scarcity is a fundamental concept in economics. It means that the resources available to satisfy human wants are limited, while human wants themselves are virtually unlimited.
• This fundamental imbalance directly leads to economic problems. Because resources are scarce, societies must make choices about how to allocate these limited resources among competing uses. This is the core of the economic problem: what to produce, how to produce, and for whom to produce.
• For example, a country with limited land might have to choose between using it for agriculture (food production) or for building factories (industrial production). This choice has economic consequences regarding output, employment, and income.
• Therefore, the implication of resource scarcity is primarily economic problems, as it forces individuals, businesses, and governments to make decisions about resource allocation and trade-offs. This aligns with the definition of economics as the study of how societies manage their scarce resources.
• Option (A) Political problems, while they can arise from economic issues, are not the direct and primary implication of resource scarcity itself. Scarcity creates the economic problem, which *then* might lead to political debates or conflicts over resource distribution.
• Option (C) Geographical problems are related to the physical distribution of resources but are not the direct implication of scarcity in the economic sense. Scarcity is about the *insufficiency* of resources relative to wants, not just their location.
About This Chapter: Introduction to Business Economics
Paper
Paper 4: Business Economics
Weightage
5%
Key Topics
Meaning, Scope, Price Mechanism
This chapter lays the groundwork for understanding Business Economics as a discipline. It covers the meaning, scope, and nature of economics — including key distinctions like Microeconomics vs Macroeconomics, Positive vs Normative economics, and the fundamental economic problem of scarcity. Students learn how businesses use economic principles for decision-making in a competitive marketplace.
View Official ICAI SyllabusExam Strategy Tip
Focus on definitions and distinctions between concepts. Questions often test whether you understand the difference between Micro and Macro, or Positive and Normative statements.
Related Comparison Tables
More Questions from Introduction to Business Economics
A study of how increases in the corporate income tax rate will affect the nation unemployment rate is an example of
In a ______ the producer is free to set up any type of firms produce goods and services of his choice.
In the beginning the word economics was
In Economics, we use the term scarcity to mean;
In a free market economy, allocation of resources is determined by
If there is no central planning authority to make the fundamental economic decisions and thus to allocate productive resources, how can then free enterprise or capitalist economy solve its central problems?
Ready to Master Introduction to Business Economics?
Practice all 209 questions with instant feedback, earn XP, track your streaks, and ace your CA Foundation exam.
Start Practicing — It's Free