Economics

In the current scenario, it is important to set certain constants such as the premise that regardless of how one gets to work the assumption is that one will get to work on time and will work the standard 8 hour work shift.  This means that the only other variable is how much time individuals will spend for work-life balance activities such as recreation and rest.

Under the current assumptions, the options can be ranked accordingly, riding a bus, riding a motorcycle, riding a limousine and walking.  From a cost perspective, while walking is the cheapest, it is also the most hazardous to ones health and more time consuming.  This means that more is lost in the long run if one gets sick.  The motorcycle and limousine are also not cost effective since both will entail parking costs as well as gasoline expenses (rental for the limo).  This means that from a purely financial perspective the bus ride is the most economical.

Limousine  while it allows the luxuries and comforts to bring a person quickly to their destination, suffers from a few impracticalities.  The end goal is to get to work to earn money.  Using this option, a person will spend more than he is capable of earning, making this an impractical and unsustainable use of resources.

Bus  offers the best balance and use of resources.  It allows a person to get to work on time with relative ease.  It does not require expending so much time and energy since one is only a passenger.  It also is the more efficient allocation of resources since it is a minimal expenditure that accomplishes the task at hand, getting to work on time.

Motorcycle  no matter how exciting and exhilarating this may be, it does not count as a practical alternative because it would also mean the acquisition of a motorcycle, a capital expenditure that immediately depreciates.  There is also the additional maintenance cost and licenses.  All over and above the parking costs that are incurred.  Choosing this alternative, a person would have to allocate a larger amount of resources than is actually necessary to get from the house to the office.

Walking  by far the cheapest alternative, this also carries with it certain considerations such as the time that is needed to complete and the energy.  Given that the weather is cold, it also exposes a person to the elements and possible illnesses that could be more expensive. 

One option not considered is car-pooling, whereby individuals bring together their scarce resources and optimize its use by sharing it with others.  This method is also very cost effective and can make efficient use of time if the individuals come from similar areas.

From a convenience perspective, while a limousine will offer the most luxury, a bus is not way off because there is also no need for a person to drive.  It also means that a person will not have to spend time parking and will also not spend as much.  From a cost benefit analysis perspective, the bus is also the most practical solution since it not only provides the basic comforts and conveniences but it is also priced relatively lower than the alternatives, save for walking.

From the perspective of scarcity, it merely shows the opportunity costs and what one person has to give up when he or she chooses one alternative.  In order to either walk, ride the motorcycle, take a limousine or the bus, one has a limited number of options with a fixed amount of time and money and the selection of one precludes the selection of another.

Economics has been defined as the allocation of scarce resources among unlimited needs or desires (Mankiw 2006).  Basically, this is explained by the concept of supply and demand.  However, the real decision making process involved in economics is much more complex than just a supply and demand curve.  There are basically four principles that are employed when people make economic decisions trade-offs, opportunity costs, rational thought responding to margins and response to incentives (Mankiw 2006).  The first two principles deal with the things that must be given up in order to acquire another commodity.  This is an offshoot of the definition of economics since all resources are limited and a person must make a choice between allocating his or her resources between one good while giving up another (Blaug 2007).  This is measured by the opportunity cost.  The third principle involves the marginal cost of an item over the marginal benefits.  Applying the theory that people act rationally, people make their decisions when the marginal benefits outweigh the marginal costs.  Finally, the last principle involves incentives which affect the decisions of people (Blaug 2007).  Providing incentives makes people choose in favor of incentives because it is basically a value added that makes the marginal benefits higher than the marginal costs (Blaug 2007).