20602_AC_Economics_and_buisness_Year_6_Making_choices_about_resources

Resource decisions – 1
Every day, consumers make decisions and trade-offs concerned with fulfilling their needs and
wants. Economists would say while consumers’ needs can be satisfied, their wants are unlimited.
In other words, we are never completely satisfied with what we have (not for long, anyway!). The
problem is that while our wants are unlimited, the resources we use to fulfil them are not. When
you think of the word resource, you might think of things you can see and touch. These might
include natural resources such as land, water and minerals, capital resources such as machinery,
tools and buildings, and human resources (the work, skills and abilities of people). But resources
can also refer to other things we use to achieve or acquire something. For example, when you
need to make a decision about whether to spend 30 minutes playing with your dog or doing
music practice, the resource in question is your time. Other examples of resources that we use
every day are money and information.
How can we make good decisions about how to use or spend resources? You might consider:
• deciding on priorities
for example, ‘I have decided to spend an hour helping out at my school’s cake stall rather than
going to the movies because extra help is needed’.
• considering the opportunity cost
for example, ‘If I buy this book, I won’t have enough money to buy that toy’.
• identifying what can be satisfied with resources already available
for example, ‘Instead of buying a new bike, I could fix up my old bike for half the money’.
These basic methods of making personal choices about using limited resources are also used by
businesses and organisations, including governments. In this case, the consequences of using
limited resources can be far-reaching and grave. For example:
• A local council needs to decide whether it should allow a bigchain
supermarket to be built. The new supermarket could create
new jobs for townspeople but the trade-off is that building the
supermarket means destroying native bushland. This could be a
habitat for wildlife or be of special significance to different groups
of people.
• A state government department needs to decide whether to use a
sum of money to improve either an aged-care facility or a hospital.
The decision could have serious consequences for the people who
miss out on the funding, such as residents, patients and staff.
Allocating and using limited resources at a business or government level involves many difficult
trade-offs—and these can evoke passionate responses from the community. Perhaps you can
think of some examples you have seen in the news.
R.I.C. Publications ® www.ricpublications.com.au Australian Curriculum Economics and business (Year 6) 11