Which of the following contributes to the economic problem of scarcity?

• A. Unlimited resources and limited wants
• B. Limited resources and unlimited wants
• C. Perfectly elastic supply
• D. Government price controls

Answer: (B)

Verified step by step guidance

1. Understand the economic problem of scarcity: it arises because resources are limited while human wants are unlimited.
2. Analyze each option by comparing it to the definition of scarcity.
3. Option 1: 'Unlimited resources and limited wants' contradicts scarcity because if resources were unlimited, scarcity would not exist.
4. Option 2: 'Limited resources and unlimited wants' matches the definition of scarcity, as it highlights the imbalance causing scarcity.
5. Options 3 and 4 (Perfectly elastic supply and Government price controls) relate to market conditions but do not directly cause scarcity.