Tag: opportunity cost

NBA Marriage Proposal Fail

It takes a lot of courage to propose to your partner in front of thousands of on-lookers and most of the time the answer, at least in public, is a solid “yes,” but this individual wasn’t so lucky. This clip is a good opening clip to use for opportunity costs, which is the value of the next best alternative. For the young lady, she quickly considered life with her partner and realized that the opportunity cost outweighed the benefit.

If you were the young man proposing, what would you rather be doing at that moment than what he’s going through? Instead of purchasing the engagement ring (average of $6000 in the US), what would you have spent that money on?

Thanks to Greg Caskey for the suggestion!

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Wedding Crashers — Free Riding

Jeremy and John are seasoned wedding crashers and they are out looking for weddings to get easy dates, open bars, and nice meals. This example of free-riding works well because none of them pay the cost of attendance and they even come up with creative tricks to not have to pay for the cash bars.

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Going Places (1948)

 

From YouTube:

Cold War cartoon defending the profit motive against anti-capitalist critics. The second of seven smart-looking animated shorts in the “fun and facts about American business” series. Its subject is “the profit motive,” and it stars “Freddie Fudsie,” a lazy soap maker who just wants to go fishing. He invents bar soap, makes some money, and is about to retire in peace and quiet when a sexy lady (the Profit Motive) walks by and Freddie — who suddenly needs more money to win her affection — never sees a fishing hole again. But that’s okay, because “the profit motive has been the driving force behind the growth of American industry” and “will make a better life for the children of tomorrow.”

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How I Met Your Mother — Girls Vs Suits

Barney’s girlfriend finds his closet full of suits and gives him an ultimatum. He must choose between a closet of suits that he loves or a beautiful girl. He then breaks out into song about the benefits of both before ultimately making his final decisions.

Thanks for the recommendation Courtney Conrad!

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The Little Mermaid — A Kiss for Humanity

Ariel is making a deal with Ursula to become human. The clip begins with Ursula telling Ariel that she can become a human for three days by taking her magic potion. If Prince Eric falls in love with Ariel by the third day then she can stay human forever. If he does not fall in love with her, then she will go back to being a mermaid and work for Ursula. In addition, Ursula wants Ariel to give up her voice as payment for the potion to turn human.

This clip applies to the economic concepts of opportunity cost and decision-making. Life is full of choices and with each choice comes evaluating your opportunity costs. One’s opportunity cost is what they give up to obtain something else. In this clip, Ariel has to decide whether to give up her voice to become human. At one point in the clip, Ariel says that if she becomes a human forever then she will never see her family again. She has to consider if she wants to give up being with her family to be with Prince Eric. She also must decide if she wants to give up her voice in order to turn human for three days. This clip is a great example of opportunity cost and how one must evaluate their opportunity cost to make the best decision for them.

Thank you for the clip and summary Meredith Feinstein!

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The Pursuit of Happyness — Cold Calling

In The Pursuit of Happyness, Chris (played by Will Smith) is cold calling potential clients in order to increase sales for his company. The salesman who creates the most new clients will be hired on, but because of his personal life he isn’t able to put in the same amount of time as his competitors. Chris discusses a variety of ways he saves time, including not hanging up the phone and not drinking water, each of which would cost him valuable time.

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Super Troopers — Free Hot Dog

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.

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The Simpsons — Opportunity Cost of Lines

If you’re teaching opportunity cost, this is a great clip to show the value of time. Homer waits in line 8 days to grab a coveted ticket to an event. A passerby accurately notes that the Homer could have just purchased the ticket with the money he would have earned from working.

The following scene has a nice clip that can be used to talk about efficiency and equity.

If you love economics and The Simpsons, Josh Hall edited a book that may interest you.

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How to Make Everything: A $1500 Sandwich in Only 6 Months

 

This is a great clip to talk about opportunity costs and gains from trade. The author goes through the process of making an entire chicken sandwich from scratch. I often open lecture asking students how much it would cost them if they did it themselves and then we watch this video.

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