Concept:The central problem of “how to produce” involves choosing the best technique from several possible production methods.Explanation:For producing goods and services, more than one method is often available.Producers must choose between labour-intensive and capital-intensive techniques.This means deciding the right combination of inputs, such as labour and capital, to use.Thus, whenever multiple technically possible methods exist, the basic economic problem of “how to produce” arises.Answer:C. how to produce