CASE STUDY 1

Poverty Forces Two out of Nine Children to Quit School

The hardship of a family in Pahang forces two out of nine children of a rubber to quit school,

and the other four will have the same fate if the situation becomes worse. The head of the

poor family said that he couldn't afford to send six children to school. He then decided to pull

out two of them from school after failing to get help in order to provide enough food for

everybody in the family. This is considered a sacrifice by the family in order to let the other

four children continue their education. However, if the situation gets worse and without the

help of anyone, there is a possibility that the four children will have to quit school as well.

This sad story has gained the attention of the Ministry of Education which has contributed

school uniforms and text books to them. The government has also decided to give the four

children scholarships, and a monthly allowance of RM300 will soon be given to the family.

1. Define Scarcity, choice and opportunity cost.

2. Based on the above article, identify the problem of scarcity faced by this family, the choice that they had and the opportunity cost incurred from the decision made.

3. The allowance, the books and the school uniforms could certainly help alleviate the problem faced by this family. Does it mean the scarcity does not exist anymore? Why?

4. You win a free gift in a competition. Is the gift free? Explain.