Economics·The basic economic problem · NSSCO 1.1
Scarcity, choice & opportunity cost
Narrated lesson · press play
This is where Economics begins. We meet the one big problem that the whole subject is built on: our wants are unlimited, but the resources to satisfy them are limited. That gap is called scarcity, and it forces everyone — you, a shop, and the government — to make choices. Every choice means giving something up, and the best thing you give up is called the opportunity cost. We learn to illustrate it with a clear diagram, the production possibility curve, and to use it to judge whether a decision was a good one.
What you'll learn in this lesson
By the end you should be able to (NSSCO Economics 1.1):
- Describe the nature of the economic problem (limited resources and unlimited wants)
- Explain and illustrate opportunity cost
- Evaluate the implications of specific courses of action in terms of opportunity cost
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