Class:Economics

Unit:What
IsEconomicsandWhatsItAllAbout?
Grade:12
Classsize:33
Unitlength:547minuteperiods

Day:3
Lesson:OpportunityCostandMarginalAnalysis

LessonOverview:
Inthislesson,wewillexploretheideaofopportunitycost,orthevalueofthenextbest
alternativethatwegiveupwhenwemakeachoiceamongmutuallyexclusiveoptions.
Sincethisisafoundationalideainthedisciplineofeconomics,itisimportantthatthe
studentshaveasolidunderstandingofitatthebeginningofthecourse.Thelesson
beginswithaquickreviewoftheonlinequizfromtheCrashCourseEconomics#1:
IntrotoEconomicsvideoonEDpuzzlethatIassignedthestudentstowatchfor
homework.Thestudentsthenconsiderahypotheticalscenariothattheyhaveafree
hourafterschooltodaythattheydidntexpecttohaveanddiscussideasofthingsthey
woulddowiththathourwiththepersonnexttothem.Asaclass,studentsthenshare
theirfirstandsecondchoicesofthingstodoandwediscussthemintermsofchoices
andcosts(thesecondchoicebeingwhattheydecided

nottodowiththathour).I
introducethetermsopportunitycostandmarginalanalysisaswaysofdescribingthe
valueoftheoptionwepassupandhowweweighcostsandbenefitsinmakingdecisions,
andtheideathatnothingisactuallyfreenomatterwhat,theresacosttoany
decisionwemake.Studentsthenworkinpairstocompleteanopportunitycost
worksheet,whichwereviewasaclass.Finally,Idiscussa12pagewrittenreflection
assignmentdueDay5inwhichthestudentswriteaboutatimewhentheyweighedthe
costsandbenefitsofvariousavailableoptionsinmakingadecision,andwhytheoption
theychosewasmorevaluabletothemthantheotheroptions.

EssentialQuestions:
Howshouldpeopleallocatescarceresourcesforunlimitedwantsandneeds?
Whatdoesitmeantomakedecisionsoutofrationalselfinterest?

EnduringUnderstandings:
Scarcityisaconstantinhumanexistence.
Humansweighcostsandbenefitswhenmakingdecisionsabouthowtousetheir
resources.

Keyvocabulary:

opportunitycost
tradeoff
marginalanalysis
rationalselfinterest

Note:onday2,IhandedoutaKeyVocabularysheettoallstudentsintheclasswithall
thekeyvocabularywordsIwantthemtoknowonitandspaceforthemtowritethe
definitionofeachword.Atthestartofeachlesson(afterday1),Iwritethekey
vocabularywordsforthatlessonontheboardandthenwritethedefinitionofeachas
Iintroduceitduringthelesson.Onday2,Iexplicitlytoldthestudentsthattheyshould
writethedefinitionofeachwordontheirKeyVocabularysheetbecausetheywillneed
toknowthemeaningsofthesewordsforquizzes,tests,andotherassignmentsinthe
class.

Materials:
KeyVocabularysheet
Opportunitycostworksheet

Procedures:

1. Homeworkreview(5minutes)
WereviewtheanswerstolastnightsquizfromtheCrashCourseEconomics#1:
IntrotoEconomicsvideoonEDpuzzle.(Ivealreadyreviewedandscored
studentssubmissionsthroughEDpuzzle.)

2. Activity:Howwillyouspendyourfreehour?(20minutes)
Ipresentahypotheticalscenario:youhaveanhourfreeafterschooltodaythat
youdidntexpecttohave.Maybeyourteampracticeorclubmeetingwas
canceled,orafriendyouweresupposedtomeetupwithhadtoreschedule.In
anycase,withthepersonnexttoyou,talkaboutthevariousthingsyoumightdo
duringthathour,theneachofyoupickyourfirstandsecondchoiceofthingsto
do.Afterafewminutes,wecomebacktogetherandIaskforavolunteertobethe
scribe.ThescribedrawsaTchartontheboardandwritesChoiceatthetopof
theleftcolumnandCostatthetopoftherightcolumn.Ithenaskstudentsto
sharetheirfirstandsecondchoiceswiththeclassthescribewriteseachfirst
choiceundertheChoicecolumnandsecondchoiceundertheCostcolumn.

Afterallthestudentswhowanttosharehavedoneso,Iasktheclasswhyweput
peoplessecondchoicesintheCostcolumn.Wethendiscusshoweachsecond
choiceistheopportunitycostofourfirstchoice:thatis,thenextbestalternative
wegiveupwhenwemakeachoice.Hopefullythevaluewegainfromourfirst
choiceisgreaterthantheopportunitycost,butasweallknow,sometimesthe
oppositeistrue.Inanycase,thisiswhyeverychoicewemakecomeswitha
costevenwhenwerenotspendinganymoney.Inthisdiscussion,Ialsodefine
thetermstradeoff,marginalanalysis,andrationalselfinterestandwrite

thedefinitionsontheboard(alongwithopportunitycost).

3. Pairworksheetactivity(15minutes)
Ihandoutaworksheetwithvariousscenariosofeconomicdecisions(acompany
decidingwhichproductstomake,afamilydecidinghowtospendtheirmoney,a
citymanagerdecidinghowtospendthecitysmoney,etc.).Ipairthestudents
togetherheterogeneously(fromalistIvealreadymade)andthepairsdothe
worksheet,identifyingtheopportunitycostineachcaseandexplainingwhythey
choseit.Wethenreconveneasaclassandreviewtheworksheet.

4. Homeworkannouncement(5minutes):
Icloseoutthelessonbytalkingaboutthehomeworkassignmentforday6(i.e.,
thecomingMonday,assumingtodayisWednesday):writea12page
(doublespaced)reflectiononatimewhenyoumadeadecisiontodoorpurchase
somethingbyweighingthecostsandbenefitsofyouravailableoptions.Identify
atleastthreeofthoseoptionsandthemarginalcostsandbenefitsofthem,
explainwhyyouchosetheoptionyoudid,andidentifytheopportunitycostof
yourdecision.Ialsohandouttherubricfortheassignment.

ElementsofDifferentiatedInstruction:
BuiltinelementsofDIarethecombinationoftextbookreadingandvideo
watchinginthepreviousnightshomeworkandofpairshareandwholeclass
discussionduringthelessonaswellastheopportunityforastudenttobethe
scribeintheopportunitycostactivity,whichcouldbegoodforastudentwho
likestomovearoundorwhomightbenefitfromhavingaspecialroleintheclass.
Theintentionalheterogeneousgroupingintheopportunitycostworksheet
activityisalsoakindofdifferentiation,oratleastasupportfordifferentkindsof
learners,becauseIcanpairstudentswhoarestrongerintheircontentand/or
languageskillswithstudentswhomightbenefitfrommorehelp.TheKey
Vocabularysheet,thoughgiventoallstudents,isreallyintendedforstudents
whohavedifficultytakingandorganizingnotesinclass,sointhatsenseitis
anothermodeofDI.

Morebroadly,fromthefirstdayofclassIwouldtrytocultivateawarm,
welcoming,safeclassroomenvironmentthroughthetoneIuse,thetypesof
activitiesIfacilitate,theappearanceoftheclassroom(lotsofpositivemessages
andimagesonthewalls),andthesupportsIprovide(suchaswritingthekey
vocabularyeachdayontheboard,inthesameplaceandsameformat).

AdditionalwaysIwoulddifferentiatemyinstruction:

 ForELLsintheclass,dependingonmysenseoftheirwrittenEnglish
proficiency,Imightgivethemtheoptionofwritingasingleparagraphfor
thewrittenreflectioninsteadofa12pagepaper.Alternately,Imightalso
createanoutlineforthemthatprovidesastructureforthereflection(e.g.,
TheoptionsavailabletomewereThedecisionImadewasThe
opportunitycostofthisdecisionwas...),perhapswithatableforthemto
writethecostsandbenefitsofeachoption.Imight,inadditiontoeitherof
theseapproaches,askthemtotellmetheirreflectionorally,particularlyin
caseswhereIknowthestudentslisteningcomprehensionandspoken
EnglishskillsarestrongerthanherwrittenEnglishskills.
AlsoforELLsintheclass,iftherewerebilingualstudentsintheclasswho
spokethelanguageoftheELLs,Imightaskthemtotranslatethe
instructionsfortheactivitiestothem.Fortheopportunitycostactivityand
worksheet,IwouldtrytopairELLswithbilingualstudentssothat
translationcouldhappenasneeded.
Iwouldlooktoprovideanalternateformattotheopportunitycost
worksheetthatstudentpairscouldchooseandthatwouldachievethe
samegoalofsolidifyingtheirunderstandingoftheconceptsofopportunity
costandmarginalanalysisperhapsagameoranaudiorecordingthat
presentssimilarscenariosandasksthestudentstocomeupwiththesame
conclusionsastheworksheet.