Opportunity Cost: Discussion Question

In the 1890's Marshall said, “economics is the study of man in the ordinary business of life." For one day, list all of the choices you had to make. Choose one of these decisions to briefly discuss on your blog.

• What was the decision you were faced with?

While my parents are in New York, I am babysitting my younger brother. I wanted to do something nice for my brother, so I debated whether or not to make him breakfast before school.

• What other alternative(s) did you have?

I could sleep in for a few more hours.
I could get an early start to my day instead of focusing on him.

• What was the opportunity cost of your choice?

If I didn't make my brother breakfast before school, I would be able to sleep in for a couple more hours.

If I sacrificed a few hours of sleep, I could make my brother a nice breakfast.

• What criteria did you use to make the choice? Did utility play are part in your decision? Explain.

Utility: a person's subjective measure of well-being or satisfaction

Utility definitely played a part in my decision. I would be happy to be able to sleep a little bit longer, but it would also make me happy to do something kind for my brother. Plus, making him breakfast would make my brother happy, which is important to me too. Additionally, I would like to start waking up a bit earlier anyway, so I can get in a routine. Overall, there were greater benefits to making my brother a nice breakfast than to sleeping more.