Read the case study given below and answer the question :

In reality working of an economy is much more complex than a society. During the course of basic economic problems, every society has to face scarcity of resources. This scarcity gives rise to economic problems. Every society must decide on how much of each of the many possible goods and services, it will produce. Problems of technology to be adopted also arises in due course of time. Who gets how much of produced goods and how should this produce will be distributed among the individuals in the economy are problems, which are being faced by an economy.

____________ is one of the basic economic activity of life.

Exchange

The correct answer is option (2) : Exchange

Production, exchange and consumption of goods and services are among the basic economic activities of life. In the course of these basic economic activities, every society has to face scarcity of resources and it is the scarcity of resources that gives rise to the problem of choice. The scarce resources of an economy have competing usages. In other words, every society has to decide on how to use its scarce resources.