What are we referring to when we say… Economic Choices Unlimited Wants What are we referring to when we say… Unlimited Needs

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Why does this happen? Economic Choices The mismatch of unlimited wants and needs and limited economic resources is known as the basic economic problem. Scarcity refers to not having enough resources to satisfy every need https://www.youtube.com/watch?v=yoVc_S_gd_0 The process of choosing which needs and wants will be satisfied is known as Economic Decision Making

Economic Choices When you give up something to have something else you are making a tradeoff. Ex. You are not able to buy a pair of shoes because you spent your money on a movie, popcorn and a drink

The Decision Making Process This process helps you select the best and most satisfying alternative from among a set of choices. 1. Define the problem- What is the problem to be resolved. Example: Need a car 2. Identify the Choices– Do your research. Identify and consider all alternatives. Example: Toyota Corolla/Honda Civic

The Decision Making Process 3. Evaluate the advantages and disadvantages of each choice – list advantages and disadvantages of each one. Opportunity Cost ~ The tradeoff that results from your decision. It is what you are willing to give up in order to have your first choice. Example: I’m willing to give up the convertible in order to purchase a sedan. Value can be measured in dollars, time, convenience, enjoyment, etc Why should the opportunity cost be carefully considered when making a decision?

The Decision Making Process 4. Choose the best alternative – Select the choice you believe will be the best for you at this time. 5. Act on your choice - Based on research and data gathered choose option best for you. Example: Buy the Honda Civic 6. Review your decision – After time has passed think about your decision again. What was good and not so good about your choice? If you had to do it over gain would you make the same choice? Were there consequences you did not identify?

The Decision Making Process Class project for a grade Create a document on google slides by yourself (30 points) Poster to include: What problem do you need to solve? (10 points) Use the decision making process (steps 1-6) to help you decide. (15 points) Creativity (5 points) 30 points total