PART 1

Joe is a year 11 student who gets his lunch from the school canteen each day.
He has just $3 to spend, each item costs $2.50, here are his choices in order of preference:
Meat pie
Pizza slice
Sandwich

Use the information above to explain the concepts of choice, opportunity cost and scarcity, and then explain how they are linked for Joe.

1. Choice

2. Opportunity cost

3. Scarcity

4. Links between these three concepts for Joe

Performance bicycle company makes steel and titanium handle bars for bicycles. it requires approximately 1 hour of labor to make one handle bar of either type. during the most recent accounting period, barr company made 7,700 steel bars and 2,300 titanium bars. setup costs amounted to $35,000. one batch of each type of bar was run each month. if a single company-wide overhead rate based on direct labor hours is used to allocate overhead costs to the two products, the amount of setup cost assigned to the steel bars will be: