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Slide 2 From Choices to Opportunity Costs opportunity costs the most valued alternative you give up to do something what you would have chosen instead Slide 3 Slide 4 Would you rather have the Phantom OR Would you rather have. A housein Vista $300,000 Honda Accord MSRP of $25,000 Gas allowance of $3,000 Monthly allowance for shopping of $1,000 for 1 year OR Would you rather have. A $340,000 trip around the world for a year Slide 5 The cost of passing up the next best choice when making a decision. opportunity cost. InvestorWords.com. Retrieved July 21, 2008, from InvestorWords.com website: http://www.investorwords.com/3470/opportunity_cost.html http://www.investorwords.com/3470/opportunity_cost.html Every choice we make has an opportunity cost. The most valued opportunity or alternative you give up for your 1 st choice is the opportunity cost. Slide 6 1 phantom 2house in Vista, Honda, shopping, gas 3 trip around the world Opportunity cost is all about choices. When you forgo doing homework to get on Facebook, your opportunity cost for getting on Facebook was your homework. Your choice. Your opportunity cost. Slide 7 Decision Eat at Jack-In-The-Box Opportunity Cost Eat at Mc Donalds High Opportunity Cost MacDonalds reduces prices More choices added at Mickey Ds Certified Cleanest Fast Food Restaurant in SD County Im hungry. What should I do? Slide 8 Decision Eat at Jack-In-The-Box Opportunity Cost Eat at McDonalds Low Opportunity Cost McDonalds raises prices Only serves strawberry shakes E. Coli outbreak Im hungry. What should I do? Slide 9 Because there is scarcity, there must be some way of deciding who gets what Rationing Device Because there is scarcity, there is competition Slide 10 Slide 11 Slide 12 Slide 13 Slide 14 Slide 15 Slide 16 Slide 17 Slide 18 Slide 19 Slide 20 1. At the end of your class notes, answer questions 4-6 Section Review p. 13 2. Read p. 12 Would People Go To College If Scarcity Did Not Exist? and write an answer to the question on that page. 3. Create a comic strip showing the relationship of scarcity, choice and opportunity cost Slide 21 Using the Diagrams and flow charts in Ch. 1 (pg 10), create a comic strip displaying the following underlined concepts studied in class: Wants Resources displaying Scarcity which creates choices which leaves an opportunity cost Each Term will have a frame in the comic. Choose a topic from your life Demonstrate your understanding of the flow/connections Use Voice Bubbles for each frame Be creative! Stick people rule! Must all be original work. Highlight the terms in your VoiceBubbles Slide 22 Slide 23 The science that studies the choices of people trying to satisfy their wants and needs in a world of scarcity