Explanation: In the context of Indian economic planning and general economic theory, the central problems of an economy are often summarized as the "what to produce," "how to produce," and "for whom to produce" problems. These problems are fundamental to understanding how an economy allocates its resources and makes decisions about production and distribution.
The "what to produce" problem refers to the decision of which goods and services should be produced in an economy. This involves determining the mix of products that will be manufactured or provided, taking into account the needs and preferences of the population, as well as the availability of resources.
The "how to produce" problem, on the other hand, is concerned with the methods and techniques used to produce the goods and services that have been decided upon. This includes decisions about the technology to be used, the type of machinery, the labor skills required, and the overall production process. The choice of technique of production is a key aspect of this problem, as it directly impacts the efficiency, cost, and environmental impact of production.
The "for whom to produce" problem deals with the distribution of the produced goods and services among the population. This involves deciding how the output of the economy will be allocated to different individuals and groups, based on factors such as income, social status, and need.
In the context of the question, the choice of technique of production is clearly a part of the "how to produce" problem, not the "what to produce" problem. Therefore, the statement "What to produce is the central problem of choice of technique of production" is false. The correct answer is (B) False.
Understanding these distinctions is crucial for comprehending the complexities of economic planning and resource allocation in any economy, including India. It helps in making informed decisions about production methods and technologies, which in turn can lead to more efficient and sustainable economic growth.