Concept Application of Concept from Personal Experience Reference to Concept in Reading
Opportunity Cost is stated as a cost of an alternative that must be given up in order to pursue a certain action. This concept can be used through:
• Career Choice
• Time Management
• Cost of Capital
• Production possibilities
Every time a choice is made, something else must be given up. In other words, the benefits someone could have received by taking an alternative action. This can be applied to both economics as well as to the individual decision making processes. This was chosen to demonstrate that decisions made in life impact the possible results. I
“The amount of other products that must be forgone or sacrificed to obtain 1 unit of a specific good”
(McConnell & Brue, 2004, p20).
Productive Efficiency is described as the ability to produce a good using the fewest possible resources. This concept can be applied to :
• Manufacturing
• Energy efficiency
• Food production
The ability for any business or government to produce as much as possible without wasting any limited resources is essential. Efficient production is achieved when a product or good is created at its lowest cost. This was chosen to demonstrate that efficient workings of business is just as import as producing a good to be sold
“Production efficiency is the production of any particular mix of goods and services in the least costly way”
(McConnell & Brue, 2004, p 10).
Scarcity and Choice, which happens when individuals mus ...