1. Define scarcity, choice and opportunity cost. Can you link them in your day to day lives?�
Scarcity refers to the limited availability of resources or goods relative to their demand. It implies that there are not enough resources to fulfill all the wants and needs of individuals or society.
Choice is the process of selecting one option or course of action among several alternatives. It involves making decisions based on preferences, priorities, and constraints.
Opportunity cost refers to the value of the next best alternative that must be given up when making a choice. It represents the benefits or opportunities foregone by choosing one option over another.
In our day to day lives, these concepts are interconnected. For example, if you have a limited budget and want to purchase a new smartphone, you may have to choose between different models based on their features, price, and availability. By selecting one model, you are giving up the opportunity to buy another model with different features or from a different brand. The opportunity cost in this situation would be the benefits associated with the alternate model that you did not choose. This scenario illustrates how scarcity influences our choices and leads to opportunity costs in our daily decision-making processes.