Explain the problem of 'what to produce'.

“What to produce” refers to the choice of the product to be produced by the society for that good which is in actual need of the society. We need to use the resources to produce goods & services, & the common resources are used to produce two different goods. For instance, during peacetime, the society can avoid producing Guns and can utilize more of the resources to produce other good which is actually needed by the society (say Trucks). This kind of situation arises to all the countries because the limited resources can’t be utilized to produce all the goods required by the society. Now, after deciding about the production of a good, the society needs to take decision the required quantity to be produced. This is inevitable as excess production may lead to the problem of overproduction and further to wastage of resources, and less production may lead to scarcity of the product which may further lead to the problems like inflation etc. Thus, the society needs to estimate the requirement of a good to be produced.