Scarcity and Opportunity Cost Review Turn over your warm up page. On your own, complete the review sheet. You may use your notes from yesterday if you’d like. We will review all answers together in 10 minutes.

A.Authority E. Market B.Government F. Scarcity C.Currency G. Opportunity Cost D.Allocate H. Tax Revenue ______: To spend a specific amount of money on a specific thing ______: What is given up when a person chooses something else ______: The exchange of goods and services between two or more people ______: The power to influence others and make decisions ______: The problem of having limited resources to meet unlimited wants ______: Coin or paper money used to purchase goods and services ______: An organization that uses authority to run a society ______: The income of the government when it takes tax money from the people

A.Authority E. Market B.Government F. Scarcity C.Currency G. Opportunity Cost D.Allocate H. Tax Revenue D : To spend a specific amount of money on a specific thing G : What is given up when a person chooses something else E : The exchange of goods and services between two or more people A : The power to influence others and make decisions F :The problem of having limited resources to meet unlimited wants C : Coin or paper money used to purchase goods and services B : An organization that uses authority to run a society H : The income of the government when it takes tax money from the people

Question 1 Kevin got $50 cash from his grandmother for his 16th birthday. He decided to spend his money on a $40 pair of sunglasses instead of to fill his Crown Vic with gas. Which of these is the opportunity cost of this decision? a) His birthday b) The gift of cash c) A full tank of gas d) Pair of sunglasses

Question 1 Answer Kevin got $50 cash from his grandmother for his 16th birthday. He decided to spend his money on a $40 pair of sunglasses instead of to fill his Crown Vic with gas. Which of these is the opportunity cost of this decision? c) A full tank of gas

Question 2 A city government has a limited amount of money to spend. It decides to spend the money to support local businesses instead of to remove trash from unused buildings and vacant lots. Which of these is the opportunity of this decision? a) Tax revenue b) Jobs for local residents c) A clean environment d) Profits for business owners

Question 2 Answer A city government has a limited amount of money to spend. It decides to spend the money to support local businesses instead of to remove trash from unused buildings and vacant lots. Which of these is the opportunity of this decision? c) A clean environment

Question 3 Susan owns a clothing store downtown. Not very many people like her new line of jeans, so yesterday she offered her customers a 50% discount on all lines of jeans. Which of the following is an opportunity cost of this decision? a) An increase in the demand for the jeans b) An increase in the number of people shopping c) A decrease in the quality of Susan’s jeans d) A decrease in the amount of money Susan makes

Question 3 Answer Susan owns a clothing store downtown. Not very many people like her new line of jeans, so yesterday she offered her customers a 50% discount on all lines of jeans. Which of the following is an opportunity cost of this decision? d) A decrease in the amount of money Susan makes

Question 4 Which of these would be an opportunity cost to a government offering a tax break to businesses that invest in new machinery? a) An increase in industrial innovation b) An increase in industrial productivity c) A decrease in the quality of good produced d) A decrease in the amount of tax revenue collected

Question 4 Answer Which of these would be an opportunity cost to a government offering a tax break to businesses that invest in new machinery? d) A decrease in the amount of tax revenue collected