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Economic choices

Economic choices. Basic Economic problems. Unlimited wants and needs vs. limited resources Budget cutbacks Operating costs do not always keep up with financial limitations Scarcity – not having enough resources to satisfy every need

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Economic choices

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  1. Economic choices

  2. Basic Economic problems • Unlimited wants and needs vs. limited resources • Budget cutbacks • Operating costs do not always keep up with financial limitations • Scarcity – not having enough resources to satisfy every need • Some countries do not produce enough resources for their population • Delivery not always available

  3. choices • Economic Decision Making - Must make smart economic decisions based on scarcity • Must budget income based on needs and availability of items • Decide what is needed and what is a luxury • Trade-offs and Opportunity Costs – • Trade-offs – When you give up something to have something else • Opportunity Costs – Value of the next best alternative (helps control prices, affects decision making process)

  4. The decision making process • Define the Problem • Problem must be clearly defined to make a smart decision • Identify the Choices • Identify the alternatives to the purchasing choice you will make • Evaluate Advantages & Disadvantages • How does purchasing an item affect your life, both positively and negatively

  5. The decision making process • Choose the Best Alternative • Select the choice that is the best for you (financially, physically, mentally) • Act On Your Choice • Purchasing the item or service • Review Your Decision • Review the results of your decision. (buy again, have the service again?)

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