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Question : Assertion: Scarcity is the fundamental economic problem faced by all societies.

Reason: Scarcity arises because human wants and needs are unlimited, while resources are limited.

Option 1: Both the assertion and reason are true, and the reason is a correct explanation of the assertion.

Option 2: Both the assertion and reason are true, but the reason is not a correct explanation of the assertion.

Option 3: The assertion is true, but the reason is false.

Option 4: The assertion is false, but the reason is true.


Team Careers360 15th Jan, 2024
Answer (1)
Team Careers360 20th Jan, 2024

Correct Answer: Both the assertion and reason are true, and the reason is a correct explanation of the assertion.


Solution : The correct answer is (a) Both the assertion and reason are true, and the reason is a correct explanation of the assertion.

The assertion is true. Scarcity refers to the condition of having limited resources or factors of production relative to unlimited wants and needs. It is a fundamental concept in economics because it necessitates choices and trade-offs in allocating scarce resources to satisfy various competing needs and wants.

The reason provided is a correct explanation of the assertion. Scarcity exists because human desires and demands for goods and services are virtually infinite, while the resources required to produce those goods and services are finite. The inherent imbalance between unlimited wants and limited resources leads to the necessity of making choices and trade-offs in resource allocation.

Therefore, the correct answer is (a) Both the assertion and reason are true, and the reason is a correct explanation of the assertion.

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