Economic problem arises as a result of

1. Analyze the question The question asks for the root cause of the economic problem. Look for the basic condition that forces every society to make economic decisions.

2. Explain the concept The economic problem is the challenge of deciding how to use limited resources to satisfy unlimited human wants. It exists because:

• Human wants are unlimited.
• Resources (land, labour, capital, entrepreneurship) are limited.

This gap between unlimited wants and limited resources is called scarcity. Scarcity then forces us to choose, and every choice involves giving up something, which is the opportunity cost.

3. Step-by-step reasoning

• Scarcity → the cause, because resources are not enough for all wants.
• Choice → a consequence of scarcity. If nothing were scarce, we would not need to choose.
• Opportunity cost → a consequence of choice, being the next best alternative given up.
• Money cost → just the price paid in monetary terms. It is not the origin of the problem.

The chain runs: Scarcity → Choice → Opportunity cost.

Choice and opportunity cost are results of the economic problem, not its source. Scarcity is the underlying cause.

4. Answer The correct option is D. scarcity.

5. Exam tip Remember the sequence S-C-O: Scarcity → Choice → Opportunity cost. When JAMB asks what the economic problem "arises from" or is "caused by", the answer is almost always scarcity. If a question asks what you give up when you choose, the answer is opportunity cost.