Frankie has a strict weekly budget and has only enough money this week to make one large purchase. Before he saw the condition of his old basketball shoes, he was planning to purchase a new winter coat that he saved for over several weeks. Now, Frankie must choose if he is going to purchase the new shoes and wear his older winter coat, or vice versa. In this scenario, Frankie must consider whether making one choice will force him to give up another. Based on what you have read, which economic concept is Frankie faced with? needs vs. wants opportunity cost risk and return goal setting

Question

Melody Hughes

Social Studies

18 November, 15:15

Frankie has a strict weekly budget and has only enough money this week to make one large purchase. Before he saw the condition of his old basketball shoes, he was planning to purchase a new winter coat that he saved for over several weeks. Now, Frankie must choose if he is going to purchase the new shoes and wear his older winter coat, or vice versa. In this scenario, Frankie must consider whether making one choice will force him to give up another. Based on what you have read, which economic concept is Frankie faced with? needs vs. wants opportunity cost risk and return goal setting

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Answers (1)

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Yahir Holmes · Answer 1

Opportunity cost

Explanation:

Frankie has to consider the opportunity cost of choosing either the shoe or the winter coat. Opportunity cost has to do with the value or satisfaction of an alternative forgone. He should stick with the option with the lowest opportunity cost.