The basic goal of economics is to
A) control the effects of government action.
B) determine how to distribute all that is produced in an economy.
C) address the scarcity problem created because the population's desire for goods exceeds the ability to produce them.
D) match limited resources to people's limited wants and needs.
E) control tastes and wishes so that there will be enough resources to produce all the goods and services that people want.

Question

Quizplus · Accepted Answer

Economics exists because of scarcity. Scarcity implies that the resources we have are not sufficient to produce all the goods and services we all want, and therefore choices must be made about how to allocate these resources. Economics is the study of how we make those choices. Therefore, the basic goal of economics is to address the scarcity problem created because the population's desire for goods exceeds their ability to produce them.

The Basic Goal of Economics Is to