Either before or after participating in the activities, students must learn basic definitions to know what specific concepts they have learned in the activities. Scarcity means that you always want more than you have. You can not have all the time, money or material things that you want. Every choice you make has an opportunity cost -- meaning that you must give up other options once you have made your choice.
This activity highlights the opportunity costs and trade-offs associated with every economic decision. Students are given $5 to spend however they want. Offer them different products to choose from and prices for each product. For instance, you can offer a movie ticket for $5, soda for $1 per can and gum for $0.50 for each pack. The students will see that their choice to go to the movie will require that they do not purchase any gum or soda. Give the students several different examples to work with and different amounts of money to spend on various items.
"Today's Choices" demonstrates how time and resources are finite and, therefore, life involves a series of choices. Ask the students to write down five choices they made today preparing for school. Some examples include: which shirt to wear; whether to walk or ride the bus; what to eat for breakfast. Once the students have their five choices, discuss the opportunity costs involved with each choice.
Read out loud the poem "Toys for Me," by C.D. Crain found at the Econ Ed Link website. This is a poem about a child telling her mother all the toys she wants for Christmas. After reading the poem, discuss with the class why the little girl cannot have every toy that she wants. Recall and discuss the different reasons given by the mother. Next, ask each student to choose two out of the 10 gifts on the magic tree. Then tell them to make a choice between these two gifts, and explain the opportunity cost involved in their decision.