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Chapter 1 Unit II questions

For Chapter 1 Unit II questions Click Nature & Scope of Business Economics
QUESTION
Q12) Consider the following and decide which, if any, economy is without scarcity:

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Correct

Solution:
Scarcity is a fundamental economic problem that arises because resources are limited in relation to wants that are unlimited. Therefore, all economies face the problem of scarcity.

In option (a), the pre-independent Indian economy faced the problem of scarcity because resources were limited and most people were farmers.
In option (b), a mythical economy where everybody is a billionaire is not possible because resources are limited and wants are unlimited. In
option (c), any economy where income is distributed equally among its people would still face the problem of scarcity because resources are limited.
Therefore, the answer is (d) None of the above.
Correct option is (d)