Central problems of an economy are :
(i) What to produce: The problems of choice related to the production of different goods.
(ii) How to produce: The problems of choice related to the technique of production.
(iii) Whom to produce: The problem of choice related to the distribution of output.
These problems are central to every economy.
These arise because :
(i) resources are scarce in relation to unlimited wants, and
(ii) resources have alternative uses
