| 0455 IGCSE ECONOMICS
PAPER-1-TOPIC-1-BASIC ECONOMIC PROBLEM-TOPIC WISE PAST PAPERS / PAPER-1-NATURE OF ECONOMIC PROBLEM
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BASIC ECONOMIC PROBLEM

  • People's wants continue to grow.
  • Resources such as land, machines etc are limited .
  • The economic problem arises due to the fact that wants are infinite while the resources are limited
  • The resources are needed to produce economic goods.
  • There are also free goods that exists. No resources are needed to produce the free goods.
  • Examples of free goods are ideas and works that are reproducible at zero cost, or almost zero cost.
  • An economic good is a good or service that has a benefit (utility) to society.
  • Also, economic goods have a degree of scarcity and therefore an opportunity cost. This is in contrast to a free good (like air, sea, water) where there is no opportunity cost – but abundance

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