Scarcity -Opportunity Cost

What is opportunity cost?

• your choice

• what you have given up to make a choice

What is scarcity? 

• Having too many resources 
• Not  having enough resources 

A popular bakery has only a few ingredients left to make their products.  They could bake muffins or cookies, but they can’t make both.  The bakers decide to make cookies for their customers.  What is the opportunity cost of their decision?

• muffins 
• cookies 

The Trump family has saved some money. They can spend it on a vacation to the Grand Canyon or build a swimming pool in their back yard. They decide to spend the money on a swimming pool. What is the opportunity cost of their decision?

• vacation

• swimming pool

Diamonds are ------

• Scarce

• Abundant (too many)