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Ch 9: Scarcity, Opportunity Cost & Production Possibilities

About This Chapter

The lessons contained in this chapter cover the concepts of scarcity, opportunity cost and production factors. Watch video lessons such as the one concerned with the production possibilities curve for a clearer understanding.

Scarcity, Opportunity Cost & Production Possibilities - Chapter Summary

Our instructors provide broad content coverage to fully capture what scarcity is and the resultant effects of limited resources in the marketplace. Learn that scarcity creates the reality of opportunity cost in decisions that you and businesses make on a daily basis. Opportunity cost encompasses monetary value as well as time.

You will also learn about the various factors of production and how production questions are dealt with across traditional, market, command and mixed economies. You will gain a solid understanding of the production possibilities curve as you move through the chapter's lessons and also become familiar with a number of aspects that can cause a shift to the curve. This chapter provides all the information and illustration needed to be able to accomplish these targets following completion of the lessons:

  • Identify the various factors of production and provide examples of each factor
  • Calculate the opportunity cost involved in choosing between possibilities
  • Explain how the production possibility curve can be shifted
  • Discuss production across the different economic systems
  • Describe the assumptions involved in using the production possibilities model

After you view the lessons in this chapter in the available video and text delivery formats, you can see how well you understand and can apply the content by taking short self-assessment quizzes. The video lessons boast convenient features for navigation that allow you to quickly view areas with which you wish to spend more time. You will also notice that the primary key terms are typically linked to lessons in text for further elaboration.

8 Lessons in Chapter 9: Scarcity, Opportunity Cost & Production Possibilities
Test your knowledge with a 30-question chapter practice test
Economic Scarcity and the Function of Choice

1. Economic Scarcity and the Function of Choice

Discover the foundation of the social science of economics as we explore the basic economic problem of scarce resources and unlimited wants using key definitions that create a framework for understanding everyday behavior in a nation.

Opportunity Cost: Definition & Real World Examples

2. Opportunity Cost: Definition & Real World Examples

Learn the most important concept of economics through the use of real-world scenarios that highlight both the benefits and the costs of decisions. Opportunity cost is a simple yet powerful principle that reveals how to make the best economic decisions possible, and it explains why people make the choices they do.

How to Calculate Opportunity Cost

3. How to Calculate Opportunity Cost

Learn the formula that reveals the economic value in any major choice between two possibilities. Every choice involves tradeoffs, and opportunity cost shows you how to measure these tradeoffs.

Applying the Production Possibilities Model

4. Applying the Production Possibilities Model

Producers in the economy use a visual model, called the production possibilities curve, to make the most efficient production decisions and maximize output. Learn how this model reveals the tradeoffs of every production decision with the simplified example of an economy that produces only two goods.

Shifts in the Production Possibilities Curve

5. Shifts in the Production Possibilities Curve

In this lesson you will learn how changes inside an economy lead to changes in the production possibilities of a nation. See how different scenarios from everyday life lead to shifts in the production possibilities curve.

Production in Traditional, Market, Command & Mixed Economic Systems

6. Production in Traditional, Market, Command & Mixed Economic Systems

This lesson discusses how market, traditional, mixed, and command economic systems operate. The key features, benefits, and drawbacks of each are summarized. Learn how the economic systems answer the three basic economic questions that face all economies.

Factors of Production: Definition & Examples

7. Factors of Production: Definition & Examples

There are four factors of production. The four factors are inputs needed to produce a product or provide a service. These factors include natural resources, human resources, capital, and entrepreneurship.

Using the Production Possibility Curve to Illustrate Economic Conditions

8. Using the Production Possibility Curve to Illustrate Economic Conditions

This lesson explains the economic concept of the production possibility curve, which is used to illustrate conditions and make good business decisions. Trade-offs, economic efficiency, economic inefficiency, and economic growth are explained.

Chapter Practice Exam
Test your knowledge of this chapter with a 30 question practice chapter exam.
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Practice Final Exam
Test your knowledge of the entire course with a 50 question practice final exam.
Not Taken

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