There are a variety of “free” services and products that we use every day, but are they really “free”? They’re pitched to us as having no cost, but the costs are much more than we may ever realize. There’s an older saying in the tech world that “if the product is free then you are the product.” Companies offer zero-price services to customers but earn a profit by selling data to other companies who would like to know more about you.
Just because a product or service is listed as $0 doesn’t mean there aren’t costs involved. There will always be an opportunity cost associated with the choice to use the service and that cost includes where your data and privacy end up.
Bruno Mars lists out all the things he could be doing that day if he he hadn’t decided to just lay in bed and be lazy. Even though choosing to lay in bed doesn’t have any monetary costs associated with it, it doesn’t mean that there are no costs to his decision. Every decision people make (even Bruno Mars) has an opportunity cost. While he may have a millions of dollars in his bank account, he still only has 24 hours in a day like the rest of us.
In this animated short from the Walt Disney Company, Uncle Scrooge discusses the history or money and the importance of money in the overall economy. There are A LOT of great teaching opportunities in this clip and would make a great summary of a money supply lesson or a required video to be watched before the lesson.
Opening to 7:15 History of Money Huey, Dewie, and Louie visit Scrooge McDuck and request that he help them save the money they had earned. Scrooge goes through the history of money and discusses the role of salt as the original salary that Roman soldiers received. He then goes on to describe money from other societies and why money was important following original barter economies. The characters even discuss the role of money as a medium of exchange!
7:15 to 9:59 Inflation After learning of the importance of money in the economy, the brothers question why central banks don’t just print more money if everyone wants it. Uncle Scrooge discusses the role of fiat money and why it’s important for the money to be backed by something or someone who can promise to pay the notes that are printed.
10:00 to 13:20 Financial Planning and Taxes Uncle Scrooge teaches the brothers about the importance of budgeting. People need to make sure that they allocate a portion of their income toward rent, food, and other necessities. He also teaches them about the role of taxes and how important it is for governments to have a budget and make sure that they collect taxes to pay debt.
13:20 to End Velocity of Money & Investment The boys are curious why Scrooge keeps so much money in his vault if he tells them that it’s important to put money “to work.” He teaches them that the money in his vault is just his petty cash and then goes on to discuss the importance of money circulating through the economy. The ending portion discusses the role of corporations issuing stocks and shareholders collecting dividends. At the end, he signs the boys up to manage their funds, but charges them a fee. The boys aren’t happy, but he laments that “nothing is ever free.”
People will go to great lengths to get “free” wifi even though they may not realize the cost associated with the decision. In this commercial for Qwest Communication, they try to offer wifi where people actually want to go.
Have a friend who brags about things they get for free? One of the common components of long-term contracts is that it includes a phone, but the price of the phone is often just built into the contract so the phone isn’t really free.
Elliot (Brendan Fraser) strikes a deal with the Devil (Elizabeth Hurley) in Bedazzled in order to gain the affection of a coworker. In this short clip, Elliot needs proof of the Devil’s power, so he asks for a Big Mac and a large coke. The two proceed to McDonalds, but Elliot ends up having to pay for it himself because there’s no such thing as a free lunch.
It’s sometimes hard to get across the idea of public services as being a type of public good, but “freedom” may be a simple enough concept for students. This clip from Team America takes a country-spin on why it’s important to pay for public services like freedom. It also can be used to teach the concept of opportunity cost since freedom for people today cost a lot of lives in the past.
This clip is a great one for the first week of a principles course and can be used to teach a variety of concepts including opportunity costs, marginal analysis, and incentives. Farva isn’t the smartest police officer on the force, and he’s an even worse economist. The gas station offers a “free” hot dog for people who pump 10 gallons of gas, but Farva only needs 9 gallons to fill his car. He has to make a decision on the margin about whether he wants to get that extra gallon. He weighs the costs and benefits of the extra gallon to determine if the “free” hot dog is worth the cost of 1 gallon of gas. Ultimately, the hot dog cost his 1 gallon of gas.