NCERT Solutions for Class 9th Social Science Chapter 8 Building Blocks in Economics: The Problem of Choice
Updated on 2026-09-19
About this chapter
Some preferences are needs (food, water, shelter) and others are wants (gadgets, vacations, luxury items). Fig. 8.1 sets the two rows side by side. Human wants are unlimited and keep changing — the chapter's example is upgrading from a bicycle to a motorbike and then to a car. 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 manufacturing or refrigerator manufacturing. Limited resources against unlimited wants produce scarcity , and scarcity forces choice . When one alternative is chosen the others are given up. The value of what is given up is the opportunity cost . This is the chapter's central tool, and it applies to money, to land, to time and to public s
- Chapter opening
- The chapter's opening paragraph
- Needs and wants
- Opportunity cost in everyday life
- What to Produce and for Whom?
- Market Economy
- The chapter's recap points, with the evidence behind each
- End-of-chapter exercise
Quick revision
| Term | What it means | Where it appears in the chapter | What the chapter says about it |
|---|---|---|---|
| Market | A place where buying and selling of products and services takes place. | Page 183, margin | It could be a physical market or a virtual one on the internet |
| Needs and wants | Needs are essentials; wants are the rest. | Page 183, Fig. 8.1 | Needs — food, water, shelter. Wants — gadgets, vacations, luxury items. Wants are unlimited and keep changing |
| Resources | Factors used for the production of goods and services. | Page 184, margin and Fig. 8.2 | Can be natural (water, coal) or human-made (capital, technology); limited in quantity and open to alternative uses |
| Factors of production | Land, labour, capital and technology. | Page 190, Fig. 8.6 | Introduced in Grade 8; producers must select the right mix of them to answer ‘how to produce’ |
| Scarcity | The gap between unlimited wants and limited resources. | Page 188, Fig. 8.5 | Unlimited wants + limited resources → SCARCITY → CHOICES → the three key questions |
| Opportunity cost | The value of what is given up when one alternative is chosen. | Page 184 | The chapter's central tool — the opportunity cost of growing barley is the wheat sacrificed; of sugarcane, the forgone saved water and improved soil health |
| Production Possibility Curve (PPC) | The curve showing different combinations of goods that can be produced using all available resources. | Page 185, Fig. 8.3 | Downward sloping; shows the trade-off between barley and wheat; all points on it are maximum output with efficient use and no wastage |
| Economy | The state of a country or region in terms of production and consumption of goods and services and the flow of money; the system of production, distribution, trade and consumption within a specific area such as a country. | Pages 186 and 188, margins | The chapter gives the term twice — once as a state and once as a system |
| Economic entities | One who participates in an economic activity. | Page 186, margin | Producers, consumers, government and enterprises — economics explains how they interact |
| Data | Facts and statistics collected together for reference or analysis. | Page 186, margin | “Good decisions rely on data and analysis, not guesswork” |
| Surveys | A systematic method for collecting and analysing data on economic conditions and behaviours of populations. | Page 186, margin | Economists use government reports such as economic surveys and companies' financial statements |
| Economic Survey of India | An annual document of the Ministry of Finance, presented in Parliament before the Union Budget. | Page 187, box | Reviews the past year, analyses agriculture, industry, services, employment, inflation, education, health and infrastructure; acts as a blueprint for the coming Union Budget |
| Policy | A course or principle of action adopted or proposed by organisations or individuals. | Page 187, margin | Economists guide governments on taxation and welfare spending (Fig. 8.4) |
| Labour-intensive / capital-intensive | Using more workers and less machinery / more machines and technology and fewer workers. | Page 189 | Agriculture and handicrafts lean on labour; steel and automobile manufacturing lean on machinery |
| Economic system | The system that defines the mechanisms for the production, consumption and distribution of goods, services and resources. | Page 190 | It decides who controls the decision-making, and so decides how the three key questions get answered |
| Planned economy | An economic system in which the allocation of resources and prices of goods and services are determined by the government. | Page 191, margin | A central planning authority decides what, how and for whom; strict permits and licenses restrict competition, so there is little motivation to improve quality or innovate. Examples: former Soviet Union, North Korea, Cuba |
| Market economy | An economic system in which the allocation of resources and prices are determined primarily by market forces; the government provides public goods and physical infrastructure. | Page 191, margin and Fig. 8.7 | The government “acts like a referee in a football match” — it ensures safety and law and order but does not control prices or production. Examples: USA, Japan, Hong Kong |
| Mixed economy | The market system of resource allocation in which the government and private sector coexist and compete, with private players regulated by the government. | Page 192, margin and Fig. 8.8 | Government side — fair competition rules, consumer protection, transparency, public goods, welfare programmes. Market side — profit-making businesses, innovation, competition. Examples: India (post-1991), China (post-1978), Germany, Sweden |
| Public goods | Goods and services available to all individuals without anyone being excluded; use by some does not prevent others from using them. | Page 192, margin | Parks, roads, police services, street lights and basic education |
| The 1991 reforms | India's shift from a state-led towards a more market-oriented system. | Pages 192–193, DON'T MISS OUT | After Independence India was state-led — licenses, permits, and public-sector 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 |
Exercises
- Chapter opening — The Big Questions Page 183
- The chapter's opening paragraph — In-text Questions Page 183
- Needs and wants — LET'S EXPLORE Page 184
- Opportunity cost in everyday life — LET'S EXPLORE Page 186
- What to Produce and for Whom? — In-text Questions Page 188
- What to Produce and for Whom? — THINK ABOUT IT Page 189
- Market Economy — LET'S EXPLORE Page 191
- The chapter's recap points, with the evidence behind each — Before we move on… Page 193
- End-of-chapter exercise — Questions and activities Page 193–194