Economics (ppt)

Making Choices All choices require giving up something

• A girl decides to babysit instead of going roller skating with her friends.

• Her opportunity cost is the time she could have had with her friends roller skating.

Making Choices All choices require giving up something

• A dad decides to watch his son’s soccer game instead of earning some extra money fixing the neighbor’s computer.

• His opportunity cost is the money he could have earned fixing the computer.

• Oh Give Me a Choice
• (Tune: Home on the Range)
• Oh give me a choice,
• Oh, a difficult choice,
• And I’ll think about what I could use.
• I’ll have to decide,
• With my eyes open wide,
• What I’ll give up and what I will choose.
• Opportunity cost!
• It’s the thing you give up when you choose.
• It’s the price that is paid
• When a choice must be made.
• It’s the thing that I surely will lose.

• Let’s sing a song about choice and opportunity cost.

Leaders throughout history have had to make choices that involved opportunity cost.

• The kings and queens decided to spend money to search for a short cut to Asia. They paid for ships, supplies, and manpower.

• Their opportunity cost was the money that could have be used for important things at home or to trade with other countries closer to home.

How do price incentives affect people’s behavior and choices?

• A price incentive is used to affect people’s buying behavior.
• Incentives can motivate people to take action!
• An offer for “Buy one pizza, get one free,” is a price incentive.
• A sale where items are ½ price is a price incentive.

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