A flowchart illustrating the fundamental economic problem, showing 'Unlimited ' on the left and 'Limited ' on the right, both leading to 'Scarcity' in the center. An arrow then points from 'Scarcity' to 'Choice' below it, and another arrow from 'Choice' to 'Opportunity cost' further below. Each box is clearly labelled.
Economics studies how societies allocate scarce .
The core problem is that human are unlimited.
However, the available to satisfy these are limited.
Examiner Tip
When explaining the fundamental economic problem, always explicitly mention both 'unlimited wants' and 'limited resources' to demonstrate a complete understanding.
This problem has existed throughout human history, from early hunter-gatherer societies deciding how to allocate their catch to modern nations debating budget priorities.
A flowchart illustrating the fundamental economic problem, showing 'Unlimited ' on the left and 'Limited ' on the right, both leading to 'Scarcity' in the center. An arrow then points from 'Scarcity' to 'Choice' below it, and another arrow from 'Choice' to 'Opportunity cost' further below. Each box is clearly labelled.
Economics studies how societies allocate scarce .
The core problem is that human are unlimited.
However, the available to satisfy these are limited.
Examiner Tip
When explaining the fundamental economic problem, always explicitly mention both 'unlimited wants' and 'limited resources' to demonstrate a complete understanding.
This problem has existed throughout human history, from early hunter-gatherer societies deciding how to allocate their catch to modern nations debating budget priorities.
Scarcity, choice and opportunity cost · Economics
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