Definitions
What is an opportunity cost?
A) The cost of choosing the next best alternative
B) The price of a good or service
C) Profits from a sale
D) Income from your job
A) The cost of choosing the next best alternative
You have $50 to spend on either a new video game or a concert ticket.
What is the opportunity cost of choosing the video game?
A) Playing the new video game and the experience of the video game
B) The concert ticket and the experience of the concert
B) The concert ticket and the experience of the concert
Definition & Example of Land
Definition: Natural Resources
Example: Water and cotton for jeans
A local coffee shop owner buys a brand-new, high-tech espresso machine that can brew drinks twice as fast as the old one.
Which factor is the espresso machine?
A) Land
B) Capital
C) Entrepreneurship
D) Labor
B) Capital
What does TINSTAAFL stand for?
A) Time is not saved for a free lunch
B) Trade is never sustainable for all
C) There Is No Such Thing As A Free Lunch
D) Taxes influence savings for a free lunch
C) There Is No Such Thing As A Free Lunch
You have 2 hours of free time. You can either study for an upcoming Econ test or play GeoGuessr.
What is the opportunity cost of choosing to play GeoGuessr?
A) Studying for the Econ test and passing the test
B) Playing GeoGuessr and having fun
A) Studying for the Econ test and passing the test.
Definition & Example of Labor
Definition: Human Effort
Example: Factory workers sewing jeans
A pastry chef spends 10 hours a day mixing dough, frosting cakes, and managing the kitchen staff at a busy bakery.
Which factor is the chef's time and effort?
A) Land
B) Capital
C) Entrepreneurship
D) Labor
D) Labor
Which is an example of a trade-off?
A) Receiving a free gift with a purchase
B) Choosing to work overtime instead of hanging out with friends
C) Saving money in the bank
D) Buying a lotto ticket
B) Choosing to work overtime instead of hanging out with friends
You are considering joining a sports team after school, but it would mean giving up your part-time job.
What is the opportunity cost of joining the sports team?
A) Giving up your part-time job and making money
B) Joining a sports team and having fun
A) Giving up your part-time job and making money
Definition & Example of Capital
Definition: Machinery & Tools
Example: Sewing machine to make jeans
A data center company purchases 50 acres of land in Nevada to build a facility powered entirely by the area's intense natural sunlight.
Which factor is the land and the sunlight?
A) Land
B) Capital
C) Entrepreneurship
D) Labor
A) Land
What is absolute advantage?
A) The ability to reduce costs
B) The ability to compete internationally
C) The ability to set the market price
D) The ability to produce more using fewer resources
D) The ability to produce more using fewer resources
You have 30 minutes left in Econ class, and Mr. Misher assigns a formative that will take the rest of the class, but you have paper from Ms. Wall's class you can use to make paper airplanes.
What is the opportunity cost of doing the formative?
A) Doing the formative and getting an A
B) Making the paper airplanes and distracting the class
B) Making the paper airplanes and distracting the class
Definition & Example of Entrepreneurship
Definition: Business Organization
Example: A store selling the jeans
Maya quits her corporate job and uses her savings to buy an old truck and takes the financial risk of opening her own mobile food business.
Which factor is Maya?
A) Land
B) Capital
C) Entrepreneurship
D) Labor
C) Entrepreneurship