12th grade Scarcity, choices and opportunity cost worksheet

Scarcity, choices and opportunity cost

Grade 12 Social Studies Worksheet - Building Confidence

Circle the best answer.

1. Read this first

   Use this

   Mari's Saturday (example figures, made up for practice). Columns: Choice, Pay, Mari's rank (1 = most wanted). Tutoring, $15 an hour, 1; Yard work, $12 an hour, 2; Band practice, $0, 3; Movie with friends, $0, ticket $10, 4. Mari has six free hours and can do one choice for all six. The ranks are her own. Opportunity cost is the value of the next-best choice given up.

2. 1.

   Mari picks tutoring for all six hours. Ari asks what Mari's opportunity cost is. Which answer fits the table?

   • Nothing, since she is paid for tutoring and so loses no money by choosing it
   • Yard work, her second choice, for the same six hours
   • Band practice and the movie together, since she gives up each other choice at once
   • The $15 an hour she earns, since that is the price she pays for choosing tutoring
3. 2.

   Mari has chosen tutoring. Bo asks which change would raise Mari's opportunity cost. Which one does?

   • Yard work paying $18 an hour, since her best alternative would then be worth more
   • Tutoring paying $18 an hour, since a better wage makes each hour of tutoring cost more
   • The movie ticket falling to $5, since a cheaper movie makes her fourth choice more tempting
   • Band practice getting a new teacher, since her third choice would then be easier to enjoy
4. 3.

   Mari says, "Tutoring costs me nothing because I get paid." Esme tests the claim. What is the best reply?

   • Not so: she must also add the band practice she misses, which has a cost of its own as well
   • Not so: tutoring uses six hours she could have spent on yard work, her next-best choice
   • Right: she is paid more than yard work would pay, so her cost drops to zero
   • Right: opportunity cost counts only money spent, and tutoring costs her no money
5. 4.

   Jun asks how much better off Mari is with tutoring than with her next-best choice for the six hours. Which answer fits the table?

   • $18 better off: $90 from tutoring against the $72 that yard work would pay
   • $72 better off, the pay from yard work that she gives up by choosing tutoring
   • $162 better off, the pay from tutoring and yard work together
   • $90 better off, the full pay from six hours of tutoring at $15 an hour

6. Use this

   Lemonade batches (10 cups each) (example figures, made up for practice). Columns: Batches, Total cost, Total sales. 1, $12, $20; 2, $22, $40; 3, $34, $60; 4, $50, $80; 5, $72, $100. Each batch sells for $20. A $15 sign was bought yesterday; it is not in the costs. The rule: make one more batch only while its extra sales are above its extra cost.

7. 5.

   Kira wants the number of batches that earns the most profit. Which choice does the table support?

   • Three batches, since total sales are $26 above total cost there by the widest margin
   • Four batches, because the 5th adds $22 in cost for $20 in sales
   • Two batches, since the average cost per batch is lowest there at $11
   • Five batches, since total sales rise with each batch and reach $100
8. 6.

   The $15 sign is already paid for. Luz says a 5th batch would help earn it back. Which reply is best?

   • Yes: she should keep making batches until the $15 for the sign is earned back
   • No: the $15 should be added to the 5th batch's cost, which would make it cost $37
   • Yes: the sign makes each batch more worthwhile, so profit is higher with five batches
   • No: the sign is paid either way, and the 5th batch adds $22 in cost for $20 in sales

9. The town's three projects (example figures, made up for practice)

   Project	Cost	Survey score (points)
   Library hours	$60,000	70
   Road repair	$50,000	65
   Park lights	$40,000	40

   The town has $100,000 and can pay for any projects whose costs fit. Scarcity means wants are greater than the resources available. A shortage means that at the market price buyers want more than sellers offer.

10. 7.

    Pia wants the set of projects that gives the town the most survey points within its $100,000. Which set is it?

    • Library hours and road repair, the two highest scores, for 135 points
    • Road repair and park lights, since together they cost least and total 105 points
    • Library hours alone, since it has the highest score of the three projects
    • Library hours and park lights, which fit the budget and total 110 points
11. 8.

    The town funds the library and the park lights. Ren asks for the opportunity cost of that choice. Which answer fits?

    • 175 points, the three survey scores summed as the cost of making any one choice
    • 65 points, the road repair alone, since it is the project left unfunded
    • 110 points, the survey total of the projects that the town does choose
    • 105 points, the road repair and park lights bundle that the same money could buy
12. 9.

    A caller says the town has a shortage because it cannot fund all three projects. Tala checks the definitions. Which answer fits?

    • It is a shortage: the projects are priced at their cost, and buyers want more than sellers offer
    • It is scarcity: wants exceed what the town can pay for, with no market price involved
    • It is a shortage: anyone who cannot get what they want faces a shortage of it
    • It is neither, since scarcity applies to goods that people buy in a market
13. 10.

    A resident says the scores prove each resident values library hours more than park lights. Zee tests the claim. What is the verdict?

    • Not supported: survey scores cannot be used to compare projects in any way at the town level
    • Not supported: scores are survey results, so some residents may value park lights more
    • Supported: the library costs more, so it must be worth more to the residents who vote
    • Supported: 70 is greater than 40, so each resident ranks the library above the park lights