"What is Opportunity Cost" by Paul Hoang of Sha Tin College emphasises on opportunity cost and explores the various opportunity costs faced by society. This article has been well presented in an informative and comprehensive manner. Readers are able to easily relate to the described situations in which opportunity cost applies.
Although this article has been very well thought out and has been submitted with actual facts, the ideas conveyed is still definitely arguable.
Arguments in favour:
- "One demographic change that can be observed in most developed countries is the decline in birth rates. This is largely due to the growing number of women who are choosing to have children at a later age due to their career aspirations." I do see a correlation between the level of development of a country and the decision of women to start a family as in most developed countries, women are given a higher level of education and women are more independent with modern social living attitudes in developed countries, therefore, women do not feel the need to settle down so soon and tend to delay having children as they wish to pursue their career objectives. Ultimately, the opportunity cost would be having children since women decide to put their careers first.
- I too feel that opportunity cost would be higher on individuals who have higher incomes as if they do decide to have children or more children, they would have to give up their time invested to earn higher incomes and would have to reallocate their time to spending it on raising children which will cause them to earn less money. In a way, I feel that this could possibly be related to scarcity as well. If time was considered to be a resource, a choice would have to be made as to how you wish to utilise it in the most efficient way to an individual. Resources like capital is limited, so choices do need to be made which will involve opportunity cost.
- The way businesses utilise the concept of opportunity cost has definitely helped benefit both producers and consumers which makes it a win-win situation for both parties. Hoang has definitely given some undoubtedly true and good examples that we can relate to in our daily lives but sometimes may fail to notice when it comes to dealing with the opportunity cost of time. I feel that the concept of opportunity cost has been used very cleverly with 'bins' being present at the aisles of the checkout counters as it is definitely an efficient way of distracting consumers away from time and it also benefits the producers as they will be able to experience an increase of sales.
-The opportunity cost faced by consumers who wished to deposit their money for shorter periods of time into banks is that they would get a lower rate on interest returned to them; vice versa. Banks have smartly devised the concept of opportunity cost which in return do benefit them as well as customers as when customers do deposit their money with them for a longer time, they get a higher rate of interest returned to them while the banks get more money "lent" to them from depositors.
Arguments against:
- Also, I disagree with the quote in the article "In fact, those with high incomes may have fewer children because of the high opportunity cost of a working parent spending time on a young child's upbringing." as nowadays, it is common for working parents leading busy hectic lives to employ nannies to look after their children while they are occupied with work. They would be able to afford nannies as they have high incomes to fund for their pay, also, some companies do provide nanny services as a fringe benefit provided to their employees if they do take on a high position in the company. Therefore, nowadays, I think that this is no longer an issue as working parents still can have issue without having to sacrifice their time and income they earn.
- Besides, parents do not necessarily have to spend a large amount of money on their children. Some of the expenses needed to be funded for children by parents in Box 1 is unnecessary. Nowadays, majority of people have health insurance. With health insurance bought for their children, the insurance company will be able to cover costs for hospital fees depending on the circumstances of the insurance, therefore, parents do not have to pay through their noses to cover certain hospital bills. But then again health insurance does not cover all health expenses, depending on the conditions of the health insurance bought. Parents can also choose not to send their children to private hospitals as private hospitals are much more expensive than government hospitals. I feel that it is unnecessary for parents to fund for their children's wedding, this would be up to parents to decide whether they wish to fund for their children's wedding. I can relate to this as my grandparents did not fund for my parents' wedding. Taking your children on holidays are not necessary as some parents' themselves do not travel and some parents' do not believe in taking their children for holidays.
Although this article has been very well thought out and has been submitted with actual facts, the ideas conveyed is still definitely arguable.
Arguments in favour:
- The economics of children...
- "One demographic change that can be observed in most developed countries is the decline in birth rates. This is largely due to the growing number of women who are choosing to have children at a later age due to their career aspirations." I do see a correlation between the level of development of a country and the decision of women to start a family as in most developed countries, women are given a higher level of education and women are more independent with modern social living attitudes in developed countries, therefore, women do not feel the need to settle down so soon and tend to delay having children as they wish to pursue their career objectives. Ultimately, the opportunity cost would be having children since women decide to put their careers first.
- I too feel that opportunity cost would be higher on individuals who have higher incomes as if they do decide to have children or more children, they would have to give up their time invested to earn higher incomes and would have to reallocate their time to spending it on raising children which will cause them to earn less money. In a way, I feel that this could possibly be related to scarcity as well. If time was considered to be a resource, a choice would have to be made as to how you wish to utilise it in the most efficient way to an individual. Resources like capital is limited, so choices do need to be made which will involve opportunity cost.
- Opportunity cost of time...
- The way businesses utilise the concept of opportunity cost has definitely helped benefit both producers and consumers which makes it a win-win situation for both parties. Hoang has definitely given some undoubtedly true and good examples that we can relate to in our daily lives but sometimes may fail to notice when it comes to dealing with the opportunity cost of time. I feel that the concept of opportunity cost has been used very cleverly with 'bins' being present at the aisles of the checkout counters as it is definitely an efficient way of distracting consumers away from time and it also benefits the producers as they will be able to experience an increase of sales.
-The opportunity cost faced by consumers who wished to deposit their money for shorter periods of time into banks is that they would get a lower rate on interest returned to them; vice versa. Banks have smartly devised the concept of opportunity cost which in return do benefit them as well as customers as when customers do deposit their money with them for a longer time, they get a higher rate of interest returned to them while the banks get more money "lent" to them from depositors.
Arguments against:
- The economies of children...
- Also, I disagree with the quote in the article "In fact, those with high incomes may have fewer children because of the high opportunity cost of a working parent spending time on a young child's upbringing." as nowadays, it is common for working parents leading busy hectic lives to employ nannies to look after their children while they are occupied with work. They would be able to afford nannies as they have high incomes to fund for their pay, also, some companies do provide nanny services as a fringe benefit provided to their employees if they do take on a high position in the company. Therefore, nowadays, I think that this is no longer an issue as working parents still can have issue without having to sacrifice their time and income they earn.
- Besides, parents do not necessarily have to spend a large amount of money on their children. Some of the expenses needed to be funded for children by parents in Box 1 is unnecessary. Nowadays, majority of people have health insurance. With health insurance bought for their children, the insurance company will be able to cover costs for hospital fees depending on the circumstances of the insurance, therefore, parents do not have to pay through their noses to cover certain hospital bills. But then again health insurance does not cover all health expenses, depending on the conditions of the health insurance bought. Parents can also choose not to send their children to private hospitals as private hospitals are much more expensive than government hospitals. I feel that it is unnecessary for parents to fund for their children's wedding, this would be up to parents to decide whether they wish to fund for their children's wedding. I can relate to this as my grandparents did not fund for my parents' wedding. Taking your children on holidays are not necessary as some parents' themselves do not travel and some parents' do not believe in taking their children for holidays.