Opportunity Cost and Trade-Off
Would you like to go on a vacation? Or save your money?
What is a Trade-Off?
When you sacrifice something to be able to obtain another.
What is a Opportunity cost?
Things that economic choices make us give up or the thing you give up when you chose something else.
Why are these concepts important?
These are important because they are one of the most important concepts of Economics. In other words, they mean scarcity and choice. Opportunity cost is the chance that you decide to not take which makes all the difference. Everything has Opportunity cost. If you bought something, you could of chose to get something else. "Something else" is a Opportunity costs.
Scarcity is another word for lack of resources or not enough of something to meet your needs and wants. Needs are necessities we MUST have in order to survive, Such as food, water, clothing and shelter. Wants are things we would LIKE to have, but don't necessarily need to have to survive, Such as a Car or Vacation.