Economic Concept of the Day: Opportunity Cost and Optimization

So I changed the heading of my blog yesterday because I thought it contained mild hilarious profanity that some people would not appreciate. Let us make the internet more kid-friendly. Stop swearing! Haha!

So amidst this pressure, I thought I should find an economical value in this situation. For today, we would learn about the economic concepts of Opportunity Cost and Optimization. By now, it is to be expected that we would have a considerable amount of reality and we would all be aware of the presence of limitations. If you are around the same age I am (19 turning 20) and you still think you have infinite money, time and energy then I advise you to take a hike to Basilan and engage yourself in battle, then we'll talk. (If you're still alive and healthy.) As for those who have a great sense of reality, we should by now be aware of the presence of limitations and scarcity.

For Example:

A kid studying in grade school has an allowance of, let's say, Php 100/day. He wants to grab a meal that costs Php 100 pesos (rice, ulam, drinks and dessert inclusive) but he also wants to buy a rather inexpensive card ( in my time it was Pokemon and Magic cards, now it could be anything!) for the same amount. Let's say that he brought a not-so-tasty but edible food. No doubt, the kid would buy the card in place of the meal because it would give him more pleasure. He has a full stomach even if the food was not as good as the one in Amici di Don Bosco (or school cafe, I dunno) and he gets to add a certain card to his deck.

Let us change the variable: Let us say that the kid failed to eat dinner last night and breakfast this morning. Let us also say that he forgot to bring his baon. Would he still buy the card? Possible if he's stubborn but if he's rational enough, he would probably buy the food in the cafe.

What influenced this decision? It is his desire to get the best out of a given situation. He had two choices. One is to buy the card; the other, to have something to eat.

The main point is, given any constraint, people would look for the best choice or alternative at his disposal to increase his well-being.

So, what does this have to do with my current situation?




I wanna watch a movie and probably go out tonight but I have a lot of pending activities in school so I want to compute the Opportunity Cost and optimize my well being.




Hmmmm.... I dunno yet... haha! LOL! Of course I'll finish my papers first then carry on with Prince of Caspian or Get Smart on Sunday! Possibly, get a parfait in icebergs! =)

So, what are the possible outcomes of my situation? errr... I'll read the book first... *sighs*