NCERT Solutions Class 9 Social Science Chapter 8 Building Blocks in Economics the Problem of Choice

F R E E S T U D Y M AT E R I A L F O R E V E R Y S T U D E N T

CLASS 9 · SOCIAL SCIENCE

NCERT Solutions

Chapter 8: Building Blocks in
Economics: The Problem of
Choice

NCERT Textbook — Understanding Society: India And Beyond

BOOK PAGES SECTIONS QUESTIONS MEDIUM

183 – 194 9 30 English

Solutions, notes, sample papers & more at 42 pages

Class 9 Social Science Chapter 8 Building Blocks in Economics: The Problem of Choice AglaSem · NCERT Solutions

CLASS 9 · SOCIAL SCIENCE · UNDERSTANDING SOCIETY: INDIA AND BEYOND

NCERT Solutions — Chapter 8: Building Blocks in
Economics: The Problem of Choice
This chapter builds economics from its foundation stone — scarcity. Human wants are unlimited and keep
changing, resources are limited and have alternative uses, so every individual, enterprise and government is
forced to choose; and every choice has an opportunity cost. From that single idea the chapter derives the
three key questions of economics — what, how and for whom to produce — and the three economic systems
that answer them.

TEXTBOOK BOOK PAGES

Understanding Society: India and Beyond (Class 183 – 194
9)

SECTIONS QUESTIONS

9 30

MEDIUM

English

The Big Questions — Page 183
Chapter opening

THE BIG QUESTIONS

Q1 What does economics deal with?

Economics deals with how choices are made by optimising the use of limited resources to
satisfy needs and wants. That one sentence is the chapter's definition, and every part of it is
doing work.
Start with the name. Economics comes from the Greek oikonomia, made of two words — oikos,
usually translated as ‘household’, and nemein, best translated as ‘management’. So the word
literally means household management. The chapter then widens it: when resources are
limited and wants unlimited, “not just families but also nations must plan how to use their
resources efficiently.”

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Class 9 Social Science Chapter 8 Building Blocks in Economics: The Problem of Choice AglaSem · NCERT Solutions

Human wants → unlimited and keep changing

Resources → limited, with alternative uses

The gap between them → scarcity
Scarcity forces → choice

Every choice costs → the option given up (opportunity cost)

The Production Possibility Curve on page 185 is a picture of exactly that. A farmer with a fixed
piece of land, water and labour can grow barley or wheat, and the book's own table lists what is
possible:

A
100
B

–10
Wheat (in kg)

80
C
–20
60

D
–30
40

20
–40
E

0 20 40 60 80 100

Barley (in kg)

The farmer's Production Possibility Curve, redrawn from Fig. 8.3. The five printed combinations are A
(0, 100), B (25, 90), C (50, 70), D (75, 40) and E (100, 0). Each red figure is the wheat given up for the
next extra 25 kg of barley — the opportunity cost of that step.

Economics also explains how the different economic entities — consumers, producers,
governments and financial institutions — interact: how people work and earn wages, how
wealth and resources are distributed, how prices are determined in the market, how education
and technology drive investment, and how government policies and trade influence prices,
employment and so on.

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Class 9 Social Science Chapter 8 Building Blocks in Economics: The Problem of Choice AglaSem · NCERT Solutions

Why it is not just opinion: the chapter insists that “good decisions rely on data and
analysis, not guesswork.” Families divide money between essential items, non-
essential items and savings; governments plan expenditure out of tax revenue;
enterprises study market trends. Economists study the alternatives, the opportunity
costs attached to each and the likely outcomes, using data from economic surveys
and companies' financial statements. Fig. 8.4 lists where that work is done — policy-
making (guiding governments on taxation or welfare spending), business
consulting (helping firms plan growth or improve efficiency), research and
education (studying economic trends and teaching others) and finance (advising
investors on where to invest).

Policy-making: Business
Guiding governments consulting:
on taxation or Helping firms plan
welfare spending. growth or improve
efficiency.

Research and Finance:

₹
education: Advising investors
Studying economic on where to invest.
trends and teaching
others.

Fig. 8.4, page 187 — the four fields in which economists work.

Fig. 8.4, page 187 — redrawn. The book prints the four fields as four coloured tiles in a two-by-two
grid, each with an icon and a one-line description.

Q2 What are the key questions in economics?

Three — what to produce, how to produce, and for whom to produce. The chapter is careful
about where they come from: “Any mismatch between unlimited wants and limited resources
gives rise to three key questions that the discipline of economics seeks to address.” They are not
a list to memorise; they fall out of scarcity.

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Class 9 Social Science Chapter 8 Building Blocks in Economics: The Problem of Choice AglaSem · NCERT Solutions

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Unlimited wants Limited resources
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SCARCITY

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CHOICES

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How the three key questions following Fig. 8.5 on page 188.

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1. What to produce (and in what quantities)? The chapter's example is a farming choice:
water-intensive crops such as sugarcane and paddy, or drought-resistant crops such as millets
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and pulses. Sugarcane yields high profits and supports industries such as sugar; millets and
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cost of

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3. For whom to produce? This asks about the purpose of what is made, how it is distributed

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Class 9 Social Science Chapter 8 Building Blocks in Economics: The Problem of Choice AglaSem · NCERT Solutions

TYPE OF MADE FOR WHAT THE DESIGN AND MATERIAL FOLLOW
SHOE FROM

School shoes Students Simple in design, durable and affordable

Office-wear shoes Working professionals Comfort, formal appearance and quality — often leather
or polished materials

Sports shoes Athletes and fitness Special rubber soles and lightweight materials for grip,
enthusiasts flexibility and support

Casual shoes or People, for daily use Comfortable yet affordable
slippers

Why the three questions are linked: answering ‘for whom’ decides the material,
which decides ‘what’ is produced, which then decides ‘how’. Leather shoes are
generally targeted at office-goers and high-income customers; rubber or synthetic
shoes at sports players, factory workers and people who need affordable, durable
footwear. The chapter's conclusion is the economic one — analysing what
consumers like, how much money they have and how much demand exists “makes
sure that limited resources are used well and not wasted.”

Q3 How do different economic systems address these questions?

Through who owns the resources and who holds the decision-making power. The chapter
defines the economic system as “the system that defines the mechanisms for the production,
consumption, and distribution of goods, services, and resources.” Change the system and the
same three questions get different answers.

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Class 9 Social Science Chapter 8 Building Blocks in Economics: The Problem of Choice AglaSem · NCERT Solutions

PLANNED MARKET ECONOMY MIXED ECONOMY
ECONOMY

Who decides A central planning Mainly the forces of Private individuals,
what, how and authority of the demand and supply, with enterprises and the
for whom government, such as little government government together
the planning intervention
commission

Ownership of Government owns most Largely with individuals and Private ownership with some
resources resources and sectors — private companies — degree of government
land, factories, banks, factories, shops, land regulation; large public sector
transport companies also play a very
important role

Role of Sets targets, fixes “Acts like a referee in a Fair competition rules,
government prices, controls football match” — ensures consumer protection,
production through safety and law and order, transparency, public goods,
strict permits and does not control prices or welfare programmes (Fig.
licenses production 8.8)

Competition Restricted — few Many producers offer Profit-making businesses,
and innovation enterprises may operate, similar products, innovation and competition on
so little motivation to encouraging better quality, the market side, regulated by
improve quality or lower prices and innovation the government side
innovate

Examples in the Former Soviet Union, United States of America, India (post-1991), China
chapter North Korea, Cuba Japan, Hong Kong (post-1978), Germany,
Sweden

Why the categories blur in practice: the chapter adds two qualifications and both
matter. Of market economies it says “However, governments play an important role
even in these economies” — the USA and Singapore have significant government
involvement. And of mixed economies it says “Almost all economies are mixed.” So
the three systems are best read as positions on a scale rather than as three separate
boxes; a country's real economic system is a question of degree — how much is
decided by the market and how much by the State.

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Class 9 Social Science Chapter 8 Building Blocks in Economics: The Problem of Choice AglaSem · NCERT Solutions

Did you know? India's own position on that scale moved. For the decades after
Independence India followed a more state-led approach similar to a planned
economy, with licenses and permits and public-sector dominance in banking,
transport and heavy industries. By 1991 the country faced serious economic
difficulties, and the reforms that followed reduced excessive regulations,
encouraged private enterprise, opened the economy to global trade and investment,
and increased competition — shifting India gradually towards a more market-
oriented system while still retaining an important role for the government.

In-text Questions — Page 183
The chapter's opening paragraph

IN-TEXT

Q1 If you had to choose, would you spend your pocket money on snacks or save it for a
new pair of shoes?

There is no single correct choice here — the economics lies in how you make it, not which
way you go. The question is the chapter's first example of choice under scarcity: your pocket
money is limited, both uses are attractive, and picking one means giving up the other.
Method. Set out the two uses, ask which is a need and which a want, and then state plainly
what you give up either way — that is your opportunity cost.

Snacks now → immediate enjoyment, gone the same day
Shoes later → lasts months, but you must wait and give up the snacks

Opportunity cost of shoes = the snacks not eaten

Opportunity cost of snacks = the shoes not bought

Sample answer: I would save it for the shoes. My old shoes are torn and shoes are a need,
while snacks are a want — and I can already eat at home. The opportunity cost of my decision is
a month of snacks with friends, which is real and I do feel it. But the snacks give me a few
minutes of pleasure each day and are then finished, whereas the shoes will be used every
school day for a year. Since my pocket money is limited, I am choosing the use that gives me
more value over the whole year for the same rupees.

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Class 9 Social Science Chapter 8 Building Blocks in Economics: The Problem of Choice AglaSem · NCERT Solutions

Check it yourself: a friend who already owns good shoes could reason just as
carefully and reach the opposite answer. That is not a contradiction — opportunity
cost depends on what you are giving up, so the same choice can be right for one
person and wrong for another.

Q2 If your school library had only five copies of a new storybook but 20 students
wanted to read it, who should get the book first?

This is scarcity in its purest form — 5 copies for 20 readers — so the library must adopt
some rule for allocating them. The economic point is that any rule gives the book to some
students and denies it to others, so the honest task is to compare the rules, not to pretend a
painless answer exists.

RULE HOW IT WORKS WHAT IT DOES WELL WHO LOSES OUT

First come, Whoever asks first is Simple, and needs no Students who live far away,
first served issued a copy judgement by the librarian or whose class period ends
later

A lottery or Names are drawn for the Every student has an equal Nothing is matched to need
draw five copies chance; nobody can complain — a student writing a
of favouritism project on it may miss out

Fixed- Each copy is issued for, Over three weeks all 20 Those late in the queue
period say, three days and then students can read it — the wait longest
rotation passes on resource is shared, not
exhausted

Need-based Students who need it for Puts the book where it Requires the librarian to
priority an assignment or exam produces the most value judge, which can seem
get it first unfair

The strongest answer combines two of them: use need-based priority for any student who
needs the book for schoolwork, and a fixed-period rotation for the rest. Rotation is the key
idea, because a book is not used up by being read — unlike food or fuel, the same five copies
can serve all 20 students if the time each one holds them is limited.

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Class 9 Social Science Chapter 8 Building Blocks in Economics: The Problem of Choice AglaSem · NCERT Solutions

co m
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Why the rule matters more than the choice: when a resource is scarce, someone

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must be turned away. A stated, known rule makes that refusal predictable and fair,
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Q3 Can the students share them or should the school buy more copies?

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cost. Sharing raises the use got out of the existing resource, which is precisely what “using

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Why buying more is a separategdecision. The school library has a limited budget, and money
spent on ten extra copies of one storybook is money not spent on other titles, on magazines or
on repairs. So:
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Opportunity cost of 10 extra copies = the other books that budget would have bought
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If the book is set reading for a class, everyone needs it in the same fortnight and rotation

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cannot solve it — then buying more copies is the right call. If it is a popular story that students
merely want to read, rotation is enough.

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Tip: notice that the two answers come from the two sides of the chapter's opening
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Class 9 Social Science Chapter 8 Building Blocks in Economics: The Problem of Choice AglaSem · NCERT Solutions

Q4 Which type of crop should a farmer grow based on the condition of the soil, rainfall,
and market demand?

The crop whose value, after allowing for what growing it gives up, is highest for that
particular field. This is the ‘what to produce’ question asked of a single farmer, and the
chapter's answer is that it depends on the three conditions named — and on their opportunity
costs.

CONDITION WHAT THE FARMER MUST ASK THE CHAPTER'S EXAMPLE

Soil Will this crop grow well here, and will it Millets and pulses improve soil health; that
leave the soil better or worse for the gain is lost if sugarcane is grown instead
next season?

Rainfall Is there enough water, and at what cost Sugarcane and paddy are water-intensive;
to the water that remains? millets and pulses are drought-resistant and
save water

Market Who will buy it, at what price, and is Sugarcane yields high profits and supports
demand that demand steady? industries such as sugar

So a farmer on well-watered land near a sugar mill may reasonably grow sugarcane, while a
farmer in a low-rainfall region is better served by millets and pulses. The choice is not the same
everywhere because the opportunity cost is not the same everywhere.

Why this is not only about money: the chapter is explicit that “the opportunity cost
of producing sugarcane is the forgone gains from saved water and improved soil
health.” Those gains do not appear on a bill, but they are real and they are lost.
Counting them turns the decision into what the chapter calls a trade-off between
short-term economic gains and long-term sustainability — the same trade-off, it
adds, that companies, governments and consumers must make.

The farmer also has the option the PPC describes: grow some of each. A field split between a
cash crop and a soil-improving crop earns part of the profit while keeping part of the long-term
benefit — a point between the two ends of the curve rather than at either end.

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Class 9 Social Science Chapter 8 Building Blocks in Economics: The Problem of Choice AglaSem · NCERT Solutions

Q5 Should an enterprise employ more labour or capital in the production process?

Whichever mix produces the goods at lower cost given the prices, technology and product
in front of it — there is no answer that is right for all firms. This is the ‘how to produce’
question, and the chapter lists four things that settle it.

WHAT DECIDES PUSHES TOWARDS LABOUR- PUSHES TOWARDS CAPITAL-
IT INTENSIVE INTENSIVE

Cost of capital Machines are expensive, so the firm Machines become affordable, so the firm
relies more on labour may shift to automation

Level of technology Limited technology leads to manual Advanced technology encourages machine
available production use

Nature of the product Customised or designer clothes require Mass-produced garments are better suited
skilled labour for machines

Cost and availability Labour is cheap and easily available Labour is costly or scarce, so machines
of labour become more efficient

Laws and regulations Labour laws, or incentives for machinery, also influence the decision

That is why, as the chapter says, agriculture and handicrafts rely more on labour, whereas steel
and automobile manufacturing depend more on machinery. The same garment manufacturer
may run a machine line for plain shirts and a tailoring floor for designer wear — the two
products call for different answers to the same question.

Why it is a genuine trade-off: the enterprise is choosing a mix of the four factors
of production — land, labour, capital and technology (Fig. 8.6) — and its budget is
limited. Every rupee spent on a machine is a rupee not paid in wages, and every
extra worker hired is a machine not bought. The opportunity cost is on both sides,
so the firm must compare, not simply prefer.

Q6 Should the government spend more on building highways or hospitals?

The government faces the same limited-budget problem as a household, so it cannot do
both fully — and the chapter's tool for such a decision is opportunity cost.

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Class 9 Social Science Chapter 8 Building Blocks in Economics: The Problem of Choice AglaSem · NCERT Solutions

Set the two out honestly. Highways move goods and people faster, lower transport costs,
connect villages to markets and hospitals, and support trade and employment. Hospitals treat
illness, reduce deaths and make a working population healthier and more productive. Both raise
what the chapter calls “people's quality of life”, and government revenue comes from the same
source — taxation.

Government revenue from taxation → limited

Spend ₹1 crore on a highway → the hospital ward it would have built is given up

Spend ₹1 crore on a hospital → the road that would have been laid is given up

Neither is “free” → both carry an opportunity cost

What a good answer does instead of taking a side: it names the tests a government would
actually apply.

What is already there. A district with a good road network but no hospital within 50 km has
a different answer from a district with the reverse.
How many people are served, and how urgently. Health needs are often immediate; road
benefits build up over years.
Whether one supports the other. A hospital that patients cannot reach helps few people,
and a highway serving an area with no health facilities does not save the lives an ambulance
route would.
Whether the choice must be all-or-nothing. Usually it need not be — the realistic decision
is how to divide the budget, not which one to abandon.

Tip: this is exactly the kind of choice the chapter says economists help with — they
“study the available alternatives, associated opportunity costs, and potential
outcomes”, using data from sources such as the Economic Survey, so that the
decision rests on evidence rather than guesswork.

LET'S EXPLORE — Page 184
Needs and wants

LET'S EXPLORE

Q1 List three things your parents bought this month. Can you classify them into needs
or wants?

This is your own list, so the marks lie in the classifying and the reason, not in the items.

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Class 9 Social Science Chapter 8 Building Blocks in Economics: The Problem of Choice AglaSem · NCERT Solutions

Method. Write down three purchases you actually saw or know about. Against each, apply the
chapter's test: a need is an essential — something the family could not manage without, like
food, water or shelter; a want is something that adds comfort, pleasure or status but life goes
on without it. Then give one line of reason for each, because the same item can fall on either
side depending on the family's situation.

ITEM BOUGHT NEED OR REASON
WANT

Wheat flour, dal and Need Food is one of the essentials the chapter names; the
vegetables for the month family cannot go without it

School notebooks and a Need Required for schooling; without them her studies stop
geometry box for my sister

A new smartphone, when the Want The old phone made calls; the new one adds a better
old one still worked camera and speed. Fig. 8.1 places gadgets in the wants
row

Sample answer: This month my parents bought the month's groceries, notebooks and a
geometry box for my sister, and a new smartphone. The groceries and the school supplies are
needs — food and education are essentials, and the family cannot manage without them. The
smartphone is a want, because the older phone still worked; the new one was bought for a
better camera. Making this list showed me that our needs are a fairly short and repeating list,
while our wants are the ones that keep changing every few months.

Why the line is not fixed: a smartphone is a want for a student, but for a parent
who runs a small shop and takes orders and payments on it, the same phone
becomes a need. The chapter's own example makes the point about change rather
than category — people “may want to upgrade from a bicycle to a motorbike and
then to a car”, so what counted as a satisfying want yesterday becomes the ordinary
starting point tomorrow.

Q2 Do you think having too many wants may create problems? Why or why not?

Yes — because wants are unlimited while the resources to satisfy them are not, so beyond
a point extra wants only add pressure without adding satisfaction. The chapter states both
halves of that sentence: “Human wants are unlimited and keep changing”, and “both natural
and human-made resources are limited in quantity.”
The problems that follow, in order:

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Class 9 Social Science Chapter 8 Building Blocks in Economics: The Problem of Choice AglaSem · NCERT Solutions

Fixed money spread thinner. A household's income is limited. Chasing many wants at once
co m
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means either needs get squeezed, or savings do — and savings are what pay for
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emergencies. The chapter notes that families must allocate money across essential items,

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non-essential

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The cost rises. Every want satisfied is another use of the same money given
up. With too many wants, you are constantly giving up something you would have valued

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Pressure on scarce resources. Wants are met by producing more goods, and production

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draws on natural resources like water, coal and land, which are limited. More wants therefore
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mean faster extraction and more
Dissatisfaction that does not end. Because wants keep changing — bicycle to motorbike to

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car — satisfying one simply reveals the next. The wanting does not stop when a purchase is
made.
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a s emother side, stated fairly: wants are not simply a flaw. New wants are what push
gl producers to make better goods and to innovate — the chapter says competition
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among many producers “encourages better quality, lower prices, and innovation.” A

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society with no new wants would also have little new production. The problem is not

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a cost become unavoidable.
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Sample answer: Yes, too many wants create problems, because my family's income is fixed
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while my list of wants keeps growing. If we spend on every want, either something we truly

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need is delayed or our savings go, and there is nothing left for an emergency. Wants also draw
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resources like water and fuel that the chapter says are limited.

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position is to meet needs first, choose among wants by asking what each one costs me in terms

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of what I give up, and accept that not all of them can be met.

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LET'S EXPLORE — Page 186
Opportunity cost in everyday life
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This is a short interview, and the answer must end with a clearly named opportunity cost
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Method. Ask three questions and write the replies down.

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Class 9 Social Science Chapter 8 Building Blocks in Economics: The Problem of Choice AglaSem · NCERT Solutions

1. What did you decide to buy this week, and what else were you considering? — this gives you the
two alternatives.
2. Why did you pick one over the other? — this gives the reason.
3. What did you have to drop or postpone because of it? — this is the opportunity cost, and it is
the answer to the question.

Then state it in one sentence of the form: “The opportunity cost of ___ was ___.”
Sample answer: My mother had ₹2,000 to spend at the end of the month and two uses in mind
— repairing our old ceiling fan, or buying a pressure cooker to replace the one that leaks. She
chose the fan repair, because summer had started and the fan is used by everyone in the house
all day, while the leaking cooker still works, only slowly. The opportunity cost of repairing the
fan was the pressure cooker, which now has to wait until next month — along with the
cooking gas and the time the new cooker would have saved every day.
My father described a different kind of choice. He travels to work either by bus (₹20 and about
an hour) or by shared auto (₹50 and about half an hour). On ordinary days he takes the bus. The
opportunity cost of saving ₹30 is the half hour he loses, and on days when he must reach
early that half hour is worth more than ₹30 to him, so he takes the auto. The same person
makes opposite choices because the value of what is given up changes.

What the interview teaches: the chapter defines opportunity cost as “the value of
what is given up”, and a real household decision shows why the word value matters.
The cost of a decision is not the price on the bill — it is the best alternative that the
money, or the time, could have bought instead. That is why two families with the
same ₹2,000 can spend it differently and both be right.

Q2 How do you decide to spend your time? Is time a scarce resource?

Yes — time is a scarce resource, and by the chapter's own test it is a particularly strict one.
A resource is scarce when it is limited in quantity and has alternative uses. Time is limited to 24
hours a day for everybody, and those hours can be put to many competing uses. So every hour
spent one way is an hour that cannot be spent another way.

Hours available in a day = 24 — fixed for everyone

Sleep ≈ 8 h, school ≈ 7 h, meals and travel ≈ 3 h

Hours left to allocate = 24 − 8 − 7 − 3 = 6 hours

Homework + play + television + helping at home must all fit into those 6

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Class 9 Social Science Chapter 8 Building Blocks in Economics: The Problem of Choice AglaSem · NCERT Solutions

How the decision is actually made. I first fix the hours that are not really mine to choose —
school and sleep. Then I rank what is left by two tests: what has a deadline, and what I would
regret losing. Homework due tomorrow goes first because postponing it costs marks. Play and
helping at home come next, because they cannot be stored up. Television and the phone come
last, because they expand to fill whatever time is left if I do not limit them.
The opportunity cost of an hour. If I watch television for an hour instead of revising, the cost is
not “an hour” — it is the revision I did not do and the marks that follow from it. Stated that way,
the choice becomes easier to make honestly.

Why time is scarcer than money: money can be saved, borrowed or earned again
— the amount you have is not fixed. Time cannot be saved for later, cannot be
borrowed, and cannot be increased at any price. An hour not used is simply gone.
That is why students are taught to make a timetable: a timetable is nothing but a
plan for allocating a scarce resource among competing uses, which is exactly what
the chapter says economics is about.

Try this: keep a record of one full day in half-hour blocks. Add up how much went to
studies, chores, play and screens. Most students find one block far larger than they
expected — and that block is where the opportunity cost of their day is hiding.

In-text Questions — Page 188
Section: What to Produce and for Whom?

IN-TEXT

Q1 For instance, should farmers produce water-intensive crops such as sugarcane and
paddy, or drought-resistant crops such as millets and pulses?

The chapter does not settle it for one crop, and it is right not to — it sets the choice up as
a trade-off and shows what each side costs.

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Class 9 Social Science Chapter 8 Building Blocks in Economics: The Problem of Choice AglaSem · NCERT Solutions

SUGARCANE AND PADDY MILLETS AND PULSES (DROUGHT-
(WATER-INTENSIVE) RESISTANT)

What is High profits; supports industries such as Saves water, improves soil health, promotes
gained sugar sustainable agriculture

What is The forgone gains from saved water and The higher profit and the industrial demand that
given up improved soil health sugarcane would have supported

Time Short-term economic gain Long-term sustainability
horizon

So the answer depends on the conditions the earlier page listed — soil, rainfall and market
demand. Where groundwater is deep and rainfall low, growing a water-intensive crop uses up a
resource that the whole area shares, and the opportunity cost is borne not only by that farmer
but by every farmer around. Where water is plentiful and a mill is nearby, sugarcane can be the
sensible choice.

The point the chapter is really making: “This type of decision reflects the trade-off
between short-term economic gains and long-term sustainability by accounting for
the opportunity costs of various alternatives.” The mistake is not choosing
sugarcane; the mistake is choosing it while counting only the profit and not counting
the water and the soil. Once the forgone water and soil health are entered on the
cost side, the comparison is honest — and the chapter adds that “similar trade-offs
have to be made by companies, governments, and consumers.”

A balanced conclusion: most farming regions are best served by a mix rather than by all of one
crop — some area under the cash crop for income, some under pulses and millets to protect the
soil and the water table. This is the same reasoning as the PPC: the useful choices usually lie
between the two extreme points, not at them.

THINK ABOUT IT — Page 189

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Class 9 Social Science Chapter 8 Building Blocks in Economics: The Problem of Choice AglaSem · NCERT Solutions

Section: What to Produce and for Whom?

THINK ABOUT IT

Q1 Should the government allocate more funds to healthcare and education or to
defence and space exploration? Why or why not?

This is the ‘what to produce’ question asked of a government, and the reason it is hard is
that both sides produce real benefits from one limited pool of tax revenue. A good answer
sets out both cases fully and then states the test it would use — it does not simply pick a
favourite.

THE CASE FOR HEALTHCARE AND THE CASE FOR DEFENCE AND SPACE
EDUCATION EXPLORATION

They meet needs in the chapter's sense — a sick Defence protects the country within which every other kind
child or an unschooled child is a present, of spending happens; without security, hospitals and
immediate loss schools are not safe either

A healthier, better-educated population is more Space technology returns to ordinary life through weather
productive, so the spending adds to the country's forecasting, communication, navigation and disaster
future output warning — which help farmers and fishermen directly

They are close to what the chapter calls public Both build advanced technology and skilled jobs, and
goods — basic education is listed among them, reduce dependence on other countries
available to all without anyone being excluded

The benefit reaches the poorest most directly, Their benefits are long-term and cannot be built up quickly
which speaks to ‘for whom to produce’ if neglected for years

Government revenue → limited (mainly taxation)

More to healthcare and education → less to defence and space

More to defence and space → less to healthcare and education

Either way there is an opportunity cost, and it must be named

The tests a government would apply, rather than a preference:

Urgency. A hospital that does not exist costs lives this year; a satellite delayed by a year
costs less this year but more later.
How many people are reached per rupee. Basic health and school spending reaches very
large numbers of people at low cost per person.

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Whether the private sector will do it anyway. The chapter says the government's role in a
co m
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Transparency — buyers and sellers need reliable information to make good decisions,
which the chapter treats as the basis of good decisions generally.
Public goods — parks, roads, police services, street lights and basic education. Nobody can
be excluded from using them, so no private firm can charge for them and none will supply
them.
Welfare programmes — a market answers ‘for whom to produce’ by purchasing power, so
those with little income are served last or not at all.

The chapter's own image is the fairest summary: the government “acts like a referee in a
football match”. A referee does not play, does not decide the score, and does not tell a team
how to attack — but without one the game breaks down. Applied to enterprise, that means the
government should set and enforce the rules, supply the public goods and infrastructure, and
protect consumers and workers, while leaving the ordinary business decisions — what to make,
how to price it, whom to hire, whether to expand — to the enterprise.

The cost of getting the balance wrong, in both directions: too much control and
you get the planned-economy outcome the chapter describes — restricted
competition and little motivation to innovate. Too little and you get unsafe goods,
unprotected consumers and no one supplying the public goods everyone depends
on. This is precisely why, as the chapter concludes, “almost all economies are mixed.”

Q2 Can you think of an example where government action helped or harmed an
industry or sector?

The chapter supplies its own example, and it works in both directions — India's economic
policy before and after 1991. Describing it is safer and more useful than reaching for an
example from today's newspapers, because the book gives you the facts to reason with.

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Class 9 Social Science Chapter 8 Building Blocks in Economics: The Problem of Choice AglaSem · NCERT Solutions

PERIOD WHAT THE GOVERNMENT DID WHAT THE CHAPTER SAYS THE
EFFECT WAS

The decades Followed a more state-led approach Both sides. Large public-sector capacity was
after similar to a planned economy — built in banking, transport and heavy industry.
Independence controlled industries, allocated But the chapter's account of such control also
resources, and regulated production notes that permits and licenses “prevent a
through licenses and permits; key large number of enterprises to operate in the
sectors such as banking, transport and market”, restricting competition and
heavy industries were dominated by weakening the motivation to improve quality
the public sector or innovate. “By 1991 the country faced
serious economic difficulties.”

1991 onwards Introduced major economic reforms Helped. These reforms “gradually shifted
that reduced excessive regulations, India towards a more market-oriented system
encouraged private enterprise, opened while still retaining an important role for the
the economy to global trade and government”, and India is listed in the chapter
investment, and increased competition as an example of a mixed economy from post-
1991

A second example, drawn from the chapter's own reasoning rather than from memory: the
choice between labour-intensive and capital-intensive production. The chapter says that
“government laws and regulations, such as labour laws or incentives for machinery, also
influence this decision.” So an incentive for machinery helps a manufacturer that wants to
automate — and at the same time reduces the number of workers hired in that unit. The same
government action helps one group and costs another. That is the honest shape of most policy:
it has an opportunity cost too.

How to write your own example: name the sector, name the specific government
action, and then state who gained and who lost. An answer that says only “the
government helped the industry” has not shown the economics. Keep it descriptive
— the chapter's subject is how systems work, not which government was right.

Before we move on… — Page 193

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Class 9 Social Science Chapter 8 Building Blocks in Economics: The Problem of Choice AglaSem · NCERT Solutions

The chapter's recap points, with the evidence behind each

BEFORE WE MOVE ON …

Q1 Economics deals with how individuals and societies make choices to use limited
resources to satisfy unlimited wants. Every choice involves an opportunity cost—
giving up one option for another.

The recap point holds together only if each of its four terms is anchored in something the
chapter actually showed. Take them in order.

TERM WHERE THE CHAPTER GROUNDS IT

Unlimited Fig. 8.1 separates needs from wants; the text adds that wants “keep changing” — bicycle →
wants motorbike → car

Limited Resources are “limited in quantity” and have alternative uses — Fig. 8.2 shows the same steel
resources going into medical equipment, aircraft or refrigerators

Choice The farmer with one piece of land must decide how much barley and how much wheat; the
government must decide between highways and hospitals

Opportunity “When one alternative is chosen, the other options are given up. The value of what is given up
cost is known as the opportunity cost.”

Fig. 8.2, page 184 — described here; see the textbook for the photographs. It is a column of three
colour photographs, captioned Medical equipment, Aircraft manufacturing and Refrigerator
manufacturing from top to bottom: a tray of stainless-steel surgical instruments laid out on blue cloth;
the polished steel casing of a jet engine on an assembly line; and a row of brushed-steel refrigerator
doors in a factory hall. The three together carry one point — the same resource, steel, put to three
completely different uses.

The farmer's table is the proof, and the arithmetic is worth doing. Using only the five
combinations printed on page 185:

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Class 9 Social Science Chapter 8 Building Blocks in Economics: The Problem of Choice AglaSem · NCERT Solutions

MOVE BARLEY WHEAT GIVEN OPPORTUNITY COST PER EXTRA
GAINED (KG) UP (KG) KG OF BARLEY

A (0, 100) → B 25 10 10 ÷ 25 = 0.4 kg wheat
(25, 90)

B (25, 90) → C 25 20 20 ÷ 25 = 0.8 kg wheat
(50, 70)

C (50, 70) → D 25 30 30 ÷ 25 = 1.2 kg wheat
(75, 40)

D (75, 40) → E 25 40 40 ÷ 25 = 1.6 kg wheat
(100, 0)

A → E in total 100 100 100 ÷ 100 = 1.0 kg wheat on average

Why the cost rises at every step: the farmer shifts the land, water and labour that
suit wheat best to barley first. Those early shifts cost little wheat. As more barley is
grown, the land being converted is land that was good for wheat and poor for barley
— so each further 25 kg of barley costs more and more wheat: 10, then 20, then 30,
then 40. That rising cost is exactly why the curve in Fig. 8.3 bows outward instead of
being a straight line. On a straight line from A to E the farmer at 50 kg of barley
would have 50 kg of wheat; the book's combination C gives 70 kg, which is 20 kg
more, and that gap is the concavity.

Q2 Every economy faces three central questions—what to produce, how to produce,
and for whom to produce—to decide how best to use scarce resources.

The three questions are not a list of topics; they are the three decisions that scarcity
leaves unavoidable. Fig. 8.5 shows the chain: unlimited wants and limited resources give
scarcity, scarcity forces choices, and choices split into these three.

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co m
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QUESTION WHAT IT DECIDES THE CHAPTER'S WORKED EXAMPLE

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Class 9 Social Science Chapter 8 Building Blocks in Economics: The Problem of Choice AglaSem · NCERT Solutions

PLANNED MARKET MIXED

Who answers A central planning The forces of demand Private individuals, enterprises and
the three authority of the and supply the government together
questions government

Ownership Government owns most Individuals and Private ownership with government
resources and sectors private companies regulation, plus large public sector
companies

Consequence Restricted competition, Many producers The market's innovation and
the chapter so “little motivation offering similar competition, with the government's
draws among enterprises to products, so better fair competition rules, consumer
improve quality or quality, lower prices protection, transparency, public
innovate” and innovation goods and welfare programmes

The chapter's larger claim is that these are not three separate worlds. It says of market
economies that “governments play an important role even in these economies”, and of mixed
economies that “almost all economies are mixed.” India is the chapter's own illustration of
movement along that scale — state-led after Independence, then shifted by the 1991 reforms
towards a more market-oriented system “while still retaining an important role for the
government.”

Tip: when an examination question names a country, say which features of which
system it shows rather than labelling it with one word. The chapter's examples make
this easy: former Soviet Union, North Korea and Cuba for planned; USA, Japan and
Hong Kong for market; India (post-1991), China (post-1978), Germany and Sweden
for mixed — with the USA and Singapore named as market economies that
nonetheless have significant government involvement.

Questions and activities — Pages 193–194
End-of-chapter exercise

QUESTIONS AND ACTIVITIES

Q1 Why do you think people's wants keep changing over time? How does this affect
production in an economy? Why cannot all our wants be satisfied?

Three questions, so three parts.

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Class 9 Social Science Chapter 8 Building Blocks in Economics: The Problem of Choice AglaSem · NCERT Solutions

(a) Why wants keep changing. The chapter's own example carries the answer: “people may
want to upgrade from a bicycle to a motorbike and then to a car.” Notice that the bicycle owner
did not stop wanting because the bicycle worked. Wants change because:

Satisfying one want reveals the next. Once travel is solved by a bicycle, the new want is
faster and more comfortable travel.
Income changes. As families earn more, items that were out of reach move into the list of
possibilities.
New goods appear. Nobody wanted a mobile phone before it existed. Producers “study
market trends and new innovations”, and each new product creates a want that did not exist.
Age and circumstance change. A child wants toys, a student wants books and a phone, an
adult wants a house. The same person's list changes through life.
What others have matters. Seeing a neighbour's purchase turns a possibility into a want.

(b) How this affects production. Changing wants keep pushing the ‘what to produce’
question open, so production never settles.

Wants change → demand shifts
Demand shifts → producers change what they make, and how much

Competition to serve the new demand → better quality, lower prices, innovation

Resources move from the old product to the new one → the old industry shrinks

The chapter puts the constructive side plainly: many producers offering similar products
“encourages better quality, lower prices, and innovation in production of goods and services.”
The costly side is on the same page — resources shifted to make one thing are resources taken
away from another, so changing wants continually change the opportunity cost of everything an
economy produces.
(c) Why all wants cannot be satisfied. Because of the two facts the chapter opens with, taken
together:

Human wants → unlimited and keep changing

Resources → limited in quantity, and each has alternative uses

Unlimited demand on a limited supply → scarcity

∴ some wants must always be left unmet — that is not a failure, it is arithmetic

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Class 9 Social Science Chapter 8 Building Blocks in Economics: The Problem of Choice AglaSem · NCERT Solutions

Why more production would not fix it: suppose an economy doubled its output.
Wants would not stand still to be caught — they “keep changing”, so a new set of
wants would appear above the new level of output. The gap is not caused by
producing too little; it is caused by wants being unlimited while resources are not.
This is why economics is defined as the study of choice rather than of production
alone.

Q2 ‘Human wants are unlimited and keep changing’. How do you think this constant
desire for more creates pressure on the environment? Can the fulfilment of wants
and the extraction of resources be balanced?

Every want is finally met out of a resource, and the chapter says resources are of two
kinds — natural, like water and coal, and human-made, like capital and technology. Since
human-made resources are themselves built from natural ones, unlimited wants press
ultimately on nature.
How the pressure builds, step by step:

More wants → more goods must be produced

More goods → more natural resources extracted (water, coal, land, minerals)

More extraction → the stock of a limited resource falls

More production and more discarding → more waste

The chapter's own agricultural example shows this exactly. Growing water-intensive crops such
as sugarcane and paddy uses up water and does not improve soil health; growing millets and
pulses “saves water, improves soil health, and promotes sustainable agriculture.” The forgone
water and soil are a genuine cost of meeting the demand for sugar — an environmental
opportunity cost, even though it appears on no bill. The upgrade example works the same
way: a bicycle uses almost nothing to run, a motorbike and a car consume fuel and metal, so the
same journey made in a more wanted way draws far more from nature.
Can the two be balanced? Yes — but only by counting the environmental cost as a real
cost. The chapter gives the method rather than a slogan: “This type of decision reflects the
trade-off between short-term economic gains and long-term sustainability by accounting for the
opportunity costs of various alternatives.” Balance therefore means:

Enter the resource on the cost side. If the water used and the soil damaged are counted
when comparing crops, the comparison itself changes, and so does the choice.

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Class 9 Social Science Chapter 8 Building Blocks in Economics: The Problem of Choice AglaSem · NCERT Solutions

Choose the technique, not only the product. The ‘how to produce’ question can be
answered in ways that use less water, less fuel and less material for the same output.
Separate needs from wants when resources are tight. Needs are limited and repeat; it is
the unlimited wants that expand without end.
Reuse and share rather than replace. The library example in the chapter applies here too
— the same five copies serving twenty readers is a resource used well.

Why it is a balance and not a stop: production is how needs get met and how
people's quality of life improves — the chapter says economies decide how to use
scarce resources “to meet unlimited wants and improve people's quality of life.” The
aim is therefore not to stop producing but to make choices whose long-term costs
are counted, so that the resources on which future production depends are not used
up in satisfying today's wants.

Q3 Can you think of a resource in your region that is scarce but used wastefully? How
could it be managed better?

This asks about your own region, so the answer must name a real local resource — but the
reasoning it needs is the chapter's.
Method. Build the answer in four steps:

1. Name the resource and say why it is scarce there — limited in quantity and with alternative
uses competing for it.
2. Show the waste with something you can see: a leak, a practice, an amount.
3. State the opportunity cost of the waste — what the wasted resource would otherwise have
done, and for whom.
4. Propose management that fits the cause, and be honest about what each measure costs.

Sample answer: In my area the scarce resource is groundwater. Our borewell has had to be
deepened twice in six years, and in April and May the supply falls for an hour or two each day —
clear signs that we are taking out more than the rain puts back. Yet it is used wastefully: taps
run while utensils are scrubbed, the street tap leaks all day, several households wash two-
wheelers with a running hose, and the fields near us are under a water-hungry crop even in a
low-rainfall year.
The opportunity cost of that waste is not abstract. Every litre lost from the leaking street tap is a
litre unavailable to the households at the end of the line, whose supply fails first; and every
extra metre the borewell must be deepened is money the family cannot spend on anything else.
Because groundwater is shared, one household's waste raises the cost for everyone drawing
from the same aquifer.

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co m
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MEASURE HOW IT WORKS WHAT IT COSTS

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and supply “with little government intervention”; and the government “does not control prices
or production”. So producers are free to enter any business and consumers are free to choose
among many producers offering similar products.
But the word carries a second meaning, and a full answer must say so. Freedom to choose is
worth little to someone who cannot afford any of the choices. A market answers ‘for whom to
produce’ by purchasing power, so a person with very low income is free in law and constrained
in fact. This is why the chapter lists welfare programmes and public goods on the government
side of Fig. 8.8: parks, roads, police services, street lights and basic education are available to all
“without anyone being excluded”. A mixed economy keeps the market's freedom of choice and
adds the floor that makes the choice usable, which is why many would argue it delivers the
more meaningful freedom overall.
The planned economy is the most restrictive on the chapter's own account: the central
authority decides what is produced, how, for whom, and at what prices, and strict permits and
licenses prevent a large number of enterprises from operating at all.
(b) Innovation. Here the chapter is direct. In a market economy “many producers offer similar
products, which encourages better quality, lower prices, and innovation in production of goods
and services.” In a planned economy, restricted competition means “there is little motivation
among enterprises to improve quality or innovate.”

Many producers → competition

Competition → a firm that does not improve loses customers

∴ each firm has a reason to innovate

One authority setting targets → no rival to lose customers to

∴ meeting the target is enough → little motivation to innovate

So the mechanism, not the label, is what produces innovation: competition creates the
pressure, and private ownership lets the innovator keep the reward. A mixed economy
preserves that mechanism — Fig. 8.8 places profit-making businesses, innovation and
competition on the market side — while the government supplies the fair competition rules that
keep the competition alive, funds research and education, and builds the infrastructure that
innovation depends on.

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Class 9 Social Science Chapter 8 Building Blocks in Economics: The Problem of Choice AglaSem · NCERT Solutions

The honest conclusion: the market system supplies the strongest engine for
innovation and the widest freedom of choice; the planned system supplies neither
well. But because a pure market leaves public goods unsupplied and the poorest
served last, the mixed economy is what most countries actually run — the chapter
notes that even the United States and Singapore have significant government
involvement, and that “almost all economies are mixed.”

Q5 Critically examine why pure economic systems rarely exist in reality. Assess the
limitations of such systems and justify why a mixed economy is often considered a
more practical and effective approach in real-world contexts.

Pure systems are rare because each of them, taken to its logical end, fails at something an
economy cannot do without — and the failures are opposite ones. The chapter states the
outcome itself: “In reality, most economies have features of mixed economic systems”, and
“almost all economies are mixed.”

← more government control more market control →

Planned Mixed Market

Former Soviet Union, India (post-1991), China USA, Japan,
North Korea, Cuba (post-1978), Germany, Sweden Hong Kong

No real economy sits at either end — “almost all economies are mixed”.

The three systems read as positions on a scale rather than as separate boxes, using the chapter's
own examples. The chapter adds that even the USA and Singapore “have significant government
involvement in the market”.

Limitations of a pure planned economy, from the chapter's own account:

Strict permits and licenses “prevent a large number of enterprises to operate in the market”,
so competition is restricted.
With no competition, “there is little motivation among enterprises to improve quality or
innovate”.
Enterprises “follow the central authority's targets rather than market demand” — so what is
produced can drift away from what people actually need.

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Class 9 Social Science Chapter 8 Building Blocks in Economics: The Problem of Choice AglaSem · NCERT Solutions

One authority must judge the wants and resources of an entire country, which requires more
information than any single body can gather accurately.

Limitations of a pure market economy, read from what the chapter says a government must
supply:

Public goods go unsupplied. Parks, roads, police services, street lights and basic education
are available to all “without anyone being excluded” — precisely why no private producer can
charge for them and none will provide them.
‘For whom to produce’ is answered by purchasing power, so people with low incomes are
served last. Welfare programmes appear on the government side of Fig. 8.8 for this reason.
Competition does not protect itself. Fair competition rules and consumer protection have
to be enforced by someone outside the market.
Transparency is a condition for good decisions, and the chapter's insistence on data and
analysis rather than guesswork depends on information being reliably published.

Why the mixed system is the practical answer. Because the two lists of limitations are
complements: what the market cannot supply is close to what the State can, and what the State
does badly is close to what competition does well. Fig. 8.8 divides them explicitly.

GOVERNMENT SIDE OF A MIXED ECONOMY MARKET SIDE OF A MIXED
ECONOMY

Fair competition rules, consumer protection, transparency, public Profit-making businesses, innovation,
goods, welfare programmes competition

India is the chapter's illustration of a country arriving at that position by experience rather than
by design. After Independence it followed a more state-led approach, with licenses, permits and
public-sector dominance in banking, transport and heavy industries; “by 1991 the country faced
serious economic difficulties”; the reforms then reduced excessive regulations, encouraged
private enterprise, opened the economy to global trade and investment and increased
competition, shifting India “towards a more market-oriented system while still retaining an
important role for the government.”

The critical point, fairly stated: calling a mixed economy “practical” is not the same
as calling it easy. The mix has to be judged continually — too much regulation
reproduces the planned economy's loss of competition and innovation, too little
leaves consumers unprotected and public goods unbuilt. A mixed economy does not
remove the trade-off between State and market; it makes the trade-off adjustable,
which is exactly why almost every country has ended up there.

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Class 9 Social Science Chapter 8 Building Blocks in Economics: The Problem of Choice AglaSem · NCERT Solutions

Q6 A student has ₹100 and must choose between buying a notebook or saving the
money for buying a tennis racket later. Which economic concept best explains this
situation? a. Demand b. Opportunity cost c. Production d. Inflation

(b) Opportunity cost.

Money available = ₹100 — limited

Alternative uses = notebook now, or saving towards a tennis racket

Choosing one → the other is given up

Value of what is given up = opportunity cost

The chapter's definition fits the situation word for word: “When one alternative is chosen, the
other options are given up. The value of what is given up is known as the opportunity cost.” If
the student buys the notebook, the opportunity cost is the racket (or rather, being ₹100 closer to
it). If the student saves, the opportunity cost is the notebook.
Why the other three are wrong:

OPTION WHAT IT MEANS WHY IT DOES NOT FIT

a. Demand How much of a good buyers are willing to Demand describes buyers in a market as a
buy, and one of the market forces that whole; here the issue is not how much is
settles prices in a market economy bought but which one alternative is given up

c. The making of goods and services from The student is a consumer deciding how to
Production land, labour, capital and technology spend, not a producer deciding how to make

d. Inflation A rise in prices — listed in the chapter No price is changing in the question; the ₹100
among the areas the Economic Survey and both items stay as they are
analyses

Tip: spot an opportunity-cost question by looking for three things together — a
limited amount of something, two or more uses for it, and the word “or”. All three
are present here.

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Class 9 Social Science Chapter 8 Building Blocks in Economics: The Problem of Choice AglaSem · NCERT Solutions

co m
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How does understanding opportunity cost improve the quality of economic
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decision-making?

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Because it changes what counts as the cost of a decision. Without it, a decision is judged by

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Four things it does, each visible in the chapter:
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producing sugarcane is the forgone gains from saved water and improved soil health.” Those
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cost puts them on the same page as the profit.

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than assumed.

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Class 9 Social Science Chapter 8 Building Blocks in Economics: The Problem of Choice AglaSem · NCERT Solutions

Why this improves quality and not just accuracy: the chapter says economists
“study the available alternatives, associated opportunity costs, and potential
outcomes to help individuals, enterprises, and institutions make decisions”, and that
good decisions rely on data and analysis, not guesswork. Opportunity cost is what
turns data into a decision — it supplies the common yardstick against which
alternatives that look nothing alike, like water and profit, or a road and a ward, can
finally be compared.

Q8 Can effective economic decisions be made without reliable data? Support your
answer with an example.

No. The chapter's position is explicit — “good decisions rely on data and analysis, not
guesswork.” The reason is structural: an economic decision is a comparison of alternatives and
their opportunity costs, and you cannot compare what you have not measured.

Decision = compare alternative A with alternative B

Comparison needs → the gain from each and the cost given up by each

No reliable data → no measured gain, no measured cost
∴ the “decision” is a guess that only looks like a choice

Example from the chapter — the farmer's crop choice. To decide between sugarcane and
millets, a farmer needs the yield each crop gives on that soil, the water each needs against the
rainfall the region actually receives, the price each fetched last season, and the demand
expected this year. With those figures the opportunity cost of each option can be worked out
and compared. Without them the farmer is choosing on rumour — and if the guess is wrong,
the land, water, labour and a whole season are spent on the wrong crop and cannot be
recovered.
Example at national scale — the Economic Survey. The chapter describes the Economic Survey
of India as an annual document of the Ministry of Finance, presented in Parliament before the
Union Budget, which reviews the past year's economic performance and analyses agriculture,
industry, services, employment, inflation, education, health and infrastructure, and discusses
future challenges and opportunities. It “acts as a blueprint for the upcoming Union Budget by
providing crucial insights for policymakers”. That is data doing precisely this job: a government
deciding between highways and hospitals needs to know where health facilities are thin and
where roads are missing before it can say which rupee is better spent.

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Class 9 Social Science Chapter 8 Building Blocks in Economics: The Problem of Choice AglaSem · NCERT Solutions

Examples from households and firms. Families allocate money across essential items, non-
essential items and savings — which needs a record of what actually comes in and goes out.
Enterprises “study market trends and new innovations to better serve customers and maximise
profits”, and economists use data from government reports and companies' financial
statements, whose analysis “helps to understand the potential risks and opportunities.”

The qualification worth adding: data alone is not enough — the chapter pairs it
with analysis every time. Numbers that are out of date, that measure the wrong
thing, or that are read without judgement can mislead as badly as no numbers at all.
And some things that matter, such as soil health or the value of a student's time, are
hard to measure yet must still be counted. So the honest claim is not “data decides”
but that reliable data is a necessary condition for a decision to be more than a
guess.

Q9 Analyse how a country's present economic choices can shape its long-term future.
Why is it important to consider future consequences while making economic
decisions today?

Because most economic choices commit resources that cannot be recalled, today's
decision fixes part of the range of choices available tomorrow. The chapter's closing
paragraph makes this the point of the whole chapter: “Understanding these ideas helps us
appreciate how everyday decisions, public policies, and economic systems together shape the
production, distribution, and use of resources in an economy.”
Three channels through which the present shapes the future:

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Class 9 Social Science Chapter 8 Building Blocks in Economics: The Problem of Choice AglaSem · NCERT Solutions

CHANNEL HOW IT WORKS THE CHAPTER'S EVIDENCE

The resource Natural resources are limited. Using Water-intensive crops against drought-resistant
base them fast today leaves less for ones; the opportunity cost of sugarcane is “the
tomorrow, and some — soil fertility, forgone gains from saved water and improved
groundwater — take a very long time soil health”
to restore

What gets Choices about ‘how to produce’ and Economics explains “how education and
built where to invest decide what capacity a technology drive investment”; Fig. 8.6's factors
country has decades later — factories, of production are themselves the result of
roads, hospitals, schools, technology earlier choices

The rules of The economic system a country adopts India's state-led decades, the serious economic
the system shapes competition, innovation and difficulties of 1991, and the reforms that
quality for a generation, and can itself reduced regulations, encouraged private
be changed when it stops working enterprise and opened the economy to global
trade and investment

Why future consequences must be counted today. Chiefly because the opportunity cost of a
decision is often paid later than the benefit.

Benefit of a water-intensive crop → arrives this season

Cost in lost groundwater and soil health → arrives over many seasons

Count only the near benefit → the choice looks better than it is

Count the later cost too → the comparison becomes honest

Three further reasons follow from that. Some effects cannot be undone — an exhausted
aquifer or a degraded soil cannot be repurchased at any price, so the mistake is permanent in a
way an ordinary bad purchase is not. Decisions compound — a generation educated well
produces the technology and the enterprises of the next generation, and a generation left
unschooled does not. And the people who bear the cost may not be the people making the
choice, which is why the chapter puts the phrase “long-term sustainability” beside “short-term
economic gains” instead of treating profit as the whole of the calculation.

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Class 9 Social Science Chapter 8 Building Blocks in Economics: The Problem of Choice AglaSem · NCERT Solutions

The disciplined way to say it: present choices do not determine the future, but they
set the range of futures available. A country that spends its resources on immediate
consumption keeps its options open only for a while; one that reserves part of them
for the resource base, for capacity and for capability keeps a wider set of choices
open later. That is why the chapter insists economic decisions be made on data and
analysis with the opportunity cost of every alternative weighed — including the
alternatives that belong to the future.

Q10 Identify a news article from any newspaper of your choice about a product or
commodity (such as vegetables, fruits, fuel, or electronics) where producers or
companies are deciding how much to produce or supply. Write 2–3 sentences
explaining the example you found and why the production decision was made.

This is a newspaper activity, so the article must be your own — but the 2–3 sentences
must do a specific job, and that is what earns the marks.
Method.

1. Find the right kind of report. Look in the business or agriculture pages for an item saying
that output, acreage, supply or arrivals are going up or down — for example onion or tomato
arrivals in a mandi, a sugar mill's crushing plan, a car or phone company's production target,
or a change in fuel supply.
2. Note four things before you write: the product, who is deciding (a farmer, a mill, a
company), the direction of the change, and the reason the article gives.
3. Write three sentences in this order — (i) what the article reports, (ii) the reason the
producers gave, (iii) which of the chapter's key questions this is, and what is being given up.

Sample answer (replace with your own article, and give the newspaper's name and date):

Sample answer: The report said that farmers in our district have increased the area
under tomatoes this season after prices stayed high through last winter, and that
traders expect much larger arrivals in the mandi from next month. The production
decision was made because the high price of the previous season signalled strong
demand, so growers expected a better return from tomatoes than from the crop
they had grown earlier. This is the ‘what to produce’ question being answered by
demand and price, and its opportunity cost is the earlier crop's income and the soil
and water that crop would have used differently — with the added risk that if every
grower reasons the same way, the extra supply will pull prices down.

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Class 9 Social Science Chapter 8 Building Blocks in Economics: The Problem of Choice AglaSem · NCERT Solutions

co m
m.
What makes an answer strong here: the article gives you the fact; the chapter

m l a se
gives you the explanation. Say plainly which question the producer was answering —
o
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what to produce, how to produce, or for whom — and name the
se answer that only summarises the news has left out the economics.
up.aAn
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Tip: if the article is about a company shifting to automation or adding a factory line,
.
m instead — and the chapter's list applies
s
you have found a ‘how to produce’ example
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directly: the cost of capital, the technology available, the nature of the product, the
cost and availability of labour, and government laws and regulations.

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Some preferences are needs (food, water, shelter) and others are wants (gadgets,
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vacations, luxury items). Fig. 8.1 sets the two rows side by side. Human wants are unlimited
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and keep changing — the chapter'seexample
s
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is upgrading from a bicycle to a motorbike and
then to a car.
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Resources — the factors used to produce goods and services — are limited in quantity and
have alternative uses. Fig. 8.2 shows the same steel going into medical equipment, aircraft
com
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manufacturing or refrigerator manufacturing. Limited resources against unlimited wants

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.c one alternative is chosen the others are given up. The avalue
produce scarcity, and scarcity forces choice.

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opportunity cost. This is the chapter's central tool, and it applies to money, to land, to time
and to public spending alike.

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The Production Possibility Curve (PPC) in Fig. 8.3 plots the farmer's five combinations of
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barley and wheat — A (0, 100), B (25,

l a se by using resources efficiently and avoiding wastage;
curve is a maximum output reached

agopportunity cost of barley measured in wheat.
the downward slope is the
Economics comes from the Greek oikonomia — oikos (household) + nemein (management).

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The discipline deals with how choices are made by optimising the use of limited resources
to satisfy needs and wants, and it rests on data and analysis, notm
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the country's economic system: planned, market or mixed. In reality almost all economies

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are mixed; India moved towards a more market-oriented system after the reforms of 1991.

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Class 9 Social Science Chapter 8 Building Blocks in Economics: The Problem of Choice AglaSem · NCERT Solutions

Quick revision

TERM WHAT IT MEANS WHERE IT WHAT THE CHAPTER SAYS ABOUT IT
APPEARS
IN THE
CHAPTER

Market A place where buying and Page 183, It could be a physical market or a virtual
selling of products and services margin one on the internet
takes place.

Needs and Needs are essentials; wants are Page 183, Needs — food, water, shelter. Wants —
wants the rest. Fig. 8.1 gadgets, vacations, luxury items. Wants are
unlimited and keep changing

Resources Factors used for the production Page 184, Can be natural (water, coal) or human-
of goods and services. margin and made (capital, technology); limited in
Fig. 8.2 quantity and open to alternative uses

Factors of Land, labour, capital and Page 190, Introduced in Grade 8; producers must
production technology. Fig. 8.6 select the right mix of them to answer ‘how
to produce’

Scarcity The gap between unlimited Page 188, Unlimited wants + limited resources →
wants and limited resources. Fig. 8.5 SCARCITY → CHOICES → the three key
questions

Opportunity The value of what is given up Page 184 The chapter's central tool — the
cost when one alternative is chosen. opportunity cost of growing barley is the
wheat sacrificed; of sugarcane, the forgone
saved water and improved soil health

Production The curve showing different Page 185, Downward sloping; shows the trade-off
Possibility combinations of goods that can Fig. 8.3 between barley and wheat; all points on it
Curve (PPC) be produced using all available are maximum output with efficient use
resources. and no wastage

Economy The state of a country or region Pages 186 The chapter gives the term twice — once as
in terms of production and and 188, a state and once as a system
consumption of goods and margins
services and the flow of money;
the system of production,
distribution, trade and
consumption within a specific
area such as a country.

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Class 9 Social Science Chapter 8 Building Blocks in Economics: The Problem of Choice AglaSem · NCERT Solutions

TERM WHAT IT MEANS WHERE IT WHAT THE CHAPTER SAYS ABOUT IT
APPEARS
IN THE
CHAPTER

Economic One who participates in an Page 186, Producers, consumers, government and
entities economic activity. margin enterprises — economics explains how
they interact

Data Facts and statistics collected Page 186, “Good decisions rely on data and analysis,
together for reference or margin not guesswork”
analysis.

Surveys A systematic method for Page 186, Economists use government reports such
collecting and analysing data margin as economic surveys and companies'
on economic conditions and financial statements
behaviours of populations.

Economic An annual document of the Page 187, Reviews the past year, analyses agriculture,
Survey of Ministry of Finance, presented box industry, services, employment, inflation,
India in Parliament before the Union education, health and infrastructure; acts
Budget. as a blueprint for the coming Union
Budget

Policy A course or principle of action Page 187, Economists guide governments on
adopted or proposed by margin taxation and welfare spending (Fig. 8.4)
organisations or individuals.

Labour- Using more workers and less Page 189 Agriculture and handicrafts lean on labour;
intensive / machinery / more machines and steel and automobile manufacturing lean
capital- technology and fewer workers. on machinery
intensive

Economic The system that defines the Page 190 It decides who controls the decision-
system mechanisms for the production, making, and so decides how the three key
consumption and distribution of questions get answered
goods, services and resources.

Planned An economic system in which Page 191, A central planning authority decides what,
economy the allocation of resources and margin how and for whom; strict permits and
prices of goods and services are licenses restrict competition, so there is
determined by the government. little motivation to improve quality or
innovate. Examples: former Soviet Union,
North Korea, Cuba

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Class 9 Social Science Chapter 8 Building Blocks in Economics: The Problem of Choice AglaSem · NCERT Solutions

TERM WHAT IT MEANS WHERE IT WHAT THE CHAPTER SAYS ABOUT IT
APPEARS
IN THE
CHAPTER

Market An economic system in which Page 191, The government “acts like a referee in a
economy the allocation of resources and margin and football match” — it ensures safety and law
prices are determined primarily Fig. 8.7 and order but does not control prices or
by market forces; the production. Examples: USA, Japan, Hong
government provides public Kong
goods and physical
infrastructure.

Mixed The market system of resource Page 192, Government side — fair competition rules,
economy allocation in which the margin and consumer protection, transparency, public
government and private sector Fig. 8.8 goods, welfare programmes. Market side
coexist and compete, with — profit-making businesses, innovation,
private players regulated by the competition. Examples: India (post-1991),
government. China (post-1978), Germany, Sweden

Public goods Goods and services available to Page 192, Parks, roads, police services, street lights
all individuals without anyone margin and basic education
being excluded; use by some
does not prevent others from
using them.

The 1991 India's shift from a state-led Pages 192– After Independence India was state-led —
reforms towards a more market-oriented 193, DON'T licenses, permits, and public-sector
system. MISS OUT dominance in banking, transport and
heavy industry. By 1991 the country faced
serious economic difficulties; the reforms
reduced excessive regulations, encouraged
private enterprise, opened the economy to
global trade and investment, and increased
competition

Page 42 of 42