All countries are faced with the basic economic problem of scarcity. Governmentscan intervene in their economies through the use of budgets. (a) Explain why all countries face the basic economic problem of scarcity. (b) Explain why governments have to make choices, and give an example of onechoice they might face. (c) Explain the term “labour mobility” and describe 2 measures that thegovernment could introduce to improve it. (d) Explain how the UK government can use the Budget to: (i) increase the disposable income of consumers; (ii) reduce the income gap between rich and poor.
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