Arrangement of wants in order of importance is brought about by

Analyze the question: It asks what causes us to arrange (prioritize) our wants in order of importance. This is the idea of a scale of preference.

Explain the concept: Human wants are unlimited, but the resources used to satisfy them (money, time, land, labour, capital) are limited. Because of this scarcity, we cannot satisfy every want at once. We are forced to rank our wants, putting the most urgent first and the least urgent last. This ranking is called a scale of preference.

Step-by-step solution:

• A. Excess supply of goods: If goods were in excess, there would be little need to rank wants. Incorrect.
• B. Interest in doing so: Personal interest may influence the ranking, but it is not the underlying economic cause. Incorrect.
• C. Scarcity of resources: Scarcity forces people to choose and prioritize. This is the root cause of ranking wants. Correct.
• D. Opportunity cost: This is the consequence of choosing (the next best alternative given up), not the cause of the ranking. Incorrect.
• E. Limited wants: Wants are unlimited, not limited. Incorrect.

Chain of reasoning: Unlimited wants + scarce resources → need to choose → scale of preference → opportunity cost arises from the choice made.

Exam tip: Remember the sequence Scarcity → Choice → Scale of Preference → Opportunity Cost. If a question asks what causes choice or ranking, think scarcity. If it asks what is given up when choosing, think opportunity cost.