© Oxford University Press 2016 1
Oxford Big Ideas Humanities 7 Victorian Curriculum Teacher obook assess ISBN 9780190307363
Permission has been granted for this page to be photocopied within the purchasing institution only.
Student book questions
16.4 Apply strategies to resolve economics and business issues
Pages 459460
Skill drill: Evaluating alternatives
Before looking at the different options in a business situation you must first do some work to find out more
about the topic. Once you know about the topic, you can then assess the options available and choose the
best one. This can be done using the following steps:
Step 1 Read through the different sources of information and find out what experts say about the topic.
Step 2 Make your own notes as you learn and write down any interesting facts, statistics or other
information that will help you to explore the different options.
Step 3 Next to each option, write the advantages and disadvantages, or costs and benefits.
Step 4 Get rid of the options that seem weakest based on their advantages or disadvantages.
Step 5 Concentrate on the strongest options and either decide which one is best or do further research
before choosing the best option.
Apply the skill
Let’s see how we could apply this skill to help a business owner make the right decision.
Tony runs a takeaway pizza restaurant in town that is becoming quite popular. So popular, in fact, that he is
finding it difficult to keep up with all of the customer orders for pizzas. He is worried that he will not able
to make enough pizzas in time to satisfy all customers, particularly on Friday and Saturday nights
when he is busiest. Tony is considering the following options:
a buying a new state-of-the-art oven that can reduce baking times from 15 minutes to 10 minutes, at a
cost of $80 000
b hiring a part-time employee to help out on the weekends for $17 per hour
c increasing the selling price of all pizzas by 50 per cent
© Oxford University Press 2016 2
Oxford Big Ideas Humanities 7 Victorian Curriculum Teacher obook assess ISBN 9780190307363
Permission has been granted for this page to be photocopied within the purchasing institution only.
1 Write a list of additional information that would help you to evaluate each option.
2 Write a list of the advantages and disadvantages of each option.
© Oxford University Press 2016 3
Oxford Big Ideas Humanities 7 Victorian Curriculum Teacher obook assess ISBN 9780190307363
Permission has been granted for this page to be photocopied within the purchasing institution only.
3 Suggest which option you think would be most suitable for Tony.
Check your learning 16.4
Remember and understand
1 Economists make a decision so that what kind of outcome is achieved?
2 How can you apply your business and economics knowledge to real-life situations?
Apply and analyse
3 Why do you think it is important for an economist to keep an open mind when making a decision?
4 Abby is trying to decide if she can go on holiday at the end of the year. She can’t afford the holiday
right now as she has just lost her job, but she really needs a break. Using economic reasoning, help
Abby to make her decision.