Question

Describe your understanding of the basic economic problem, or the “economizing problem.”

In your answer, consider today’s Western standard of living with access to fresh water, abundant food, and spacious housing. Compare this to the standard of living at the turn of the previous century (1899-1900). What are the differences?

• In light of Principle 8, “A country’s standard of living depends on its ability to produce goods and services” (Chapter 1, Section 1-3a), explain how each of the following categories may have attributed to the increase in the standard of living:
  • Globalization
  • Technology
  • Government
  • Transportation

Answer 1

1) the economizing problem or the basic economic problem states that societys wants are unlimited while the resource are scarce, to satisfy everybodys wants with scarce resource that is available is a difficult task. to use the available resources wisely to fulfill everybodys desire is one of the major task of any government. talking about resources, even if it is scarce its exploration to the fullest level is one of the ways how a society can fulfill all the wants. in the ancient years people were not aware  about these scarce resources and the various methods how they can make use of the resources and fulfill there wants. in 1899-1900 century though the world did not experience full utilization of all the resources by the use of modern technology still it was not that backward as well. but by the passage of time science and technology started expanding its wing and now the modern society is flying sitting over it. by the use of science and modern technology new production function are efficient enough to produce enough for the society by using those scarce resources. now people have greater standard of living, access to drinking water, specious home to live and so on. to deal with the economizing problem is to use the scarce resources to its fullest or we can say full employment of all the resources.

2)globalization plays a pivotal role in increasing countrys production in the sense that a labour abundant country can now import capital and capital intensive products and can make use pf them in its own production to increase output. import and export of new technology helps a lot in production as well.

technology- as i have mentioned earlier technology is another major component of greater production. now in this modern society technology change takes place every now and then and it is really necessary to upgrade the production process with it for better production.

government- is and will always be a driving force of production as the policies of government are mandatory to be followed. policies change by government are important for the production process

transportation- it is definatily plays a major role in production as it has to be transported to different markets(both home and foreign market) so a market to which there is good transportation facility many production units starts to function near by it and it encourages production.