gcse economics - choice and opportunity cost

Economic choice - is deciding between different uses of scarce resources

Opportunity cost - is the benefit that is lost in making a choice between two competing uses of scarce resources. It is the next best alternative.

Examples of Opportunity Cost

Allocation of Resources

This is about how resources are allocated between competing uses

Examples

* Coca Cola decide to spend £50 billion on advertising
* The government decides to spend £100 billion on hospitals
* An individual allocates their time to study rather than playing football

ACTION

1. Think of an opportunity cost that you have experienced recently
a) with money
b) with your time

2. What could be an opportunity cost of you staying in the sixth form at school?