Scarcity exists because human wants for goods and services exceed available resources, forcing consumers, businesses, and governments to make choices. All choices have opportunity costs, which is the value of the best alternative given up. Consumers face scarcity when they can't do all activities they want within their limited time. Businesses face scarcity when choosing between mutually exclusive options like adding a café or pharmacy, with the unchosen option as the opportunity cost. Governments also face scarcity, as money spent on one program can't be spent on another.

1. Basic Economic Structures EPF1a. Scarcity & Opportunity Costs

2. What is scarcity? Essential question: 2 EPF.1a scarcity & opportunity costs

3. What is scarcity? The condition of NOT being able to have all the goods and services one wants. It exists because human wants for goods and services exceed the quantity of goods and services that can be produced from all available resources 3 EPF.1a scarcity & opportunity costs

4. Why do choices result in opportunity costs? Essential question: 4 EPF.1a scarcity & opportunity costs

5. Why do choices result in opportunity costs? All choices have opportunity costs The opportunity value of a choice is the value of the best alternative given up. Choices involve trade offs - weighing the expected value of one opportunity against the expected value of its best alternative. 5 EPF.1a scarcity & opportunity costs

6. How do consumers, businesses and gov’t decision makers face scarcity of resources? Essential question: 6 EPF.1a scarcity & opportunity costs

7. How do we face scarcity of resources? Resources are scarce; Therefore, consumers, businesses, and gov’t decision makers are forced to make choices about how to use resources 7 EPF.1a scarcity & opportunity costs

8. Consumers face scarcity Ex. a consumer with 2 hours of free time cannot go ice skating for 2 hours and see a movie during the same 2 hours. Whatever choice is made, the alternative given up is the opportunity cost. 8 EPF.1a scarcity & opportunity costs

9. Businesses face scarcity Ex. Suppose a grocer is deciding whether to add a café or a pharmacy. It only has space for one. It makes a choice, the not selected choice is the opportunity cost. 9 EPF.1a scarcity & opportunity costs

10. Governments face scarcity Ex. Money spent on roads cannot be spent on education. 10 EPF.1a scarcity & opportunity costs