<concepts>
<concept>
<id>13</id>
<name>Aggregate Demand</name>
<category>1</category>
<definition><![CDATA[<p><b>Aggregate demand</b> shows the total (or aggregate) demand for final <a href="event:function=defineGlossaryTerm,Goods">goods</a> and <a href="event:function=defineGlossaryTerm,Services">services</a> at a range of <a href="event:function=defineGlossaryTerm,Price Level">price levels</a> for final output during a stated period of time. <a href="event:function=defineGlossaryTerm,Aggregate Demand (AD)">Aggregate demand</a> is commonly drawn as a line on a graph with total output on the horizontal axis and the price level on the vertical axis. An aggregate demand curve slopes downward; that is, a higher price level for outputs leads to a reduction in the quantity of aggregate demand. </p> <br><p>Aggregate demand for an economy is divided into the following components: <a href="event:function=defineGlossaryTerm,Consumption">consumption</a>, <a href="event:function=defineGlossaryTerm,Investment">investment</a>, government and <a href="event:function=defineGlossaryTerm,Net Exports">net exports</a> (exports minus <a href="event:function=defineGlossaryTerm,Imports">imports</a>). Changes in any of these components will cause the aggregate demand curve to change. For example, a surge in business confidence can lead to a larger quantity of investment at every price level for output and thus an increase in aggregate demand. Governments use macroeconomic policies in an effort to increase or decrease aggregate demand. Expansionary <a href="event:function=defineGlossaryTerm,Fiscal Policy">fiscal</a> or <a href="event:function=defineGlossaryTerm,Monetary Policy">monetary policy</a> will increase aggregate demand, while contractionary fiscal or monetary policy will decrease aggregate demand.</p>]]></definition>
<lessons><![CDATA[<p>Below are <b>featured</b> lessons for teaching Aggregate Demand.</p><br><p class="tipHeading">High School Lessons</p><p>--------------------------------------------------------------------</p><p><a href="event:function=viewLesson,67757"><b>Lesson 31: Did the New Deal Help or Harm the Recovery?</b></a><br><a href="event:function=viewPublication,105">Focus: Understanding Economics in U.S. History</a></p><br><p class="smaller_text">Note to the teacher: This lesson is closely tied to the preceding lesson, Whatdunnit? The Great Depression Mystery. The students in groups analyze the New Deal to determine whether individual policies helped end the depression by increasing aggreg...</p><br><p>--------------------------------------------------------------------</p><p><a href="event:function=viewLesson,17832"><b>Unit 6: Lesson 38 - Aggregate Demand and Aggregate Supply</b></a><br><a href="event:function=viewPublication,1">Capstone: Exemplary Lessons for High School Economics - Teacher's Guide</a></p><br><p class="smaller_text">Students build their understanding of aggregate demand and aggregate supply. They use their new skills to analyze the effects of events and government monetary and fiscal policies on inflation, unemployment, and economic growth. In the first two...</p><br><p>--------------------------------------------------------------------</p><p><a href="event:function=viewLesson,850"><b><font color="#CC6666">Online Lesson:</font> Phillips Curve</b></a><br><a href='http://www.econedlink.org/' target='_blank'>EconEdLink.org</a></p><br><p class="smaller_text">This lesson explores the relationship of unemployment to inflation in the 1960s and after. Students will discover the short-run trade-off between inflation and unemployment when unemployment is less than its natural rate. Students will learn how w...</p><br><p>--------------------------------------------------------------------</p><p><a href="event:function=viewLesson,355"><b><font color="#CC6666">Online Lesson:</font> Constitution Costs</b></a><br><a href='http://www.econedlink.org/' target='_blank'>EconEdLink.org</a></p><br><p class="smaller_text">This lesson helps students understand the basic services provided for Americans in the United States Constitution and the necessity of a system of taxation to fund those services. Students will debate the pros and cons of having governments f...</p><br>]]></lessons>
<tips><![CDATA[<p class="tipHeading">Tip #1</p><p>Students often confuse the aggregate demand curve with the demand curve they studied in microeconomics. The curves look similar. However, the aggregate demand curve shows the relationship of the price level and the aggregate quantity demanded of the economy (GDP). The relationship in an aggregate demand curve is inverse or downward sloping like a demand curve for a single good or service, but for different reasons. The downward sloping aggregate demand curve is explained by the wealth effect, the income effect and the foreign purchases effect.</p><br><p class="tipHeading">Tip #2</p><p>Aggregate demand consists of consumer spending (C), investment spending (I), government spending (G) and net export spending (NX). Total aggregate demand is GDP. When C, I, G or NX increases, GDP increases. When C, I, G or NX decreases, GDP decreases. A quick activity is to give the students events and have them identify the effects on C, I, G or NX and then on the total aggregate demand or GDP.</p><br><p class="tipHeading">Tip #3</p><p>Students often confuse investment spending in aggregate demand with purchases of stocks and bonds. Investment in stocks and bonds is financial investment. Economic investment involves spending to buy capital goods such as new factories or equipment. Economic investment affects both aggregate demand and aggregate supply. It increases aggregate demand since firms buy capital goods from other firms. It increases aggregate supply by providing firms better tools to produce more efficiently.</p><br>]]></tips>
<resources><![CDATA[<p><b>Interactive tools:</b><br /></p><p><font color="#CC6666">Video</font> <a href='http://www.econedlink.org/i276' target='_blank'>Making Sen$e with Paul Solman: 'Tis the Season, But Should We Save or Spend? A Holiday Money Conundrum</a></p><p>Is saving money during the holidays smart or Scrooge-ish? Is shopping a way of forging social bonds and expressing your freedom or is it giving in to crass commercialism? Following the lessons of some "economist Christmas carols," economics corres...<br><font size="-10"><br /></font><font size="-3">Date Published: 12/20/2012<br>Grades: 9-12<br />Source: <a href='http://www.econedlink.org/' target='_blank'>EconEdLink.org</a></font></p><br><p><font color="#CC6666">Video</font> <a href='http://www.econedlink.org/i273' target='_blank'>Making Sen$e with Paul Solman: America's Historical Struggle With Debt and the Role of Federal Government</a></p><p>Between paying now or paying later, Americans have just about always preferred debt to taxes. Paul Solman talks to Simon Johnson of the MIT Sloan School of Management about his new book "White House Burning," which chronicles the history -- includ...<br><font size="-10"><br /></font><font size="-3">Date Published: 12/12/2012<br>Grades: 9-12<br />Source: <a href='http://www.econedlink.org/' target='_blank'>EconEdLink.org</a></font></p><br><p><font color="#CC6666">Video</font> <a href='http://www.econedlink.org/i197' target='_blank'>Aggregate Demand</a></p><p>This video teaches the concept of Aggregate Demand. Aggregate demand shows the total (or aggregate) demand for final goods and services at a range of price levels for final output during a stated period of time.<br><font size="-10"><br /></font><font size="-3">Date Published: 07/12/2012<br>Grades: 9-12<br />Source: <a href='http://www.econedlink.org/' target='_blank'>EconEdLink.org</a></font></p><br><p><font color="#CC6666">Video</font> <a href='http://www.econedlink.org/i200' target='_blank'>Business Cycles</a></p><p>This video teaches the concept of Business Cycles. The pattern in which economies have periods of recession and then also periods of economic expansion or recovery is known as the business cycle.<br><font size="-10"><br /></font><font size="-3">Date Published: 07/12/2012<br>Grades: 3-5, 6-8, 9-12<br />Source: <a href='http://www.econedlink.org/' target='_blank'>EconEdLink.org</a></font></p><br><p><font color="#CC6666">Video</font> <a href='http://www.econedlink.org/i202' target='_blank'>Employment and Unemployment</a></p><p>This video teaches the concepts of Employment and Unemployment. Employment refers to people who have jobs while unemployment refers to people who wish to work but cannot find jobs.<br><font size="-10"><br /></font><font size="-3">Date Published: 07/12/2012<br>Source: <a href='http://www.econedlink.org/' target='_blank'>EconEdLink.org</a></font></p><br><p>-------------------------------------</p><p><b>Lessons:</b></p><br><p><a href='http://www.econedlink.org/e850' target='_blank'>Phillips Curve</a></p><p>This lesson explores the relationship of unemployment to inflation in the 1960s and after. Students will discover the short-run trade-off between inflation and unemployment when unemployment is less than its natural rate. Students will learn how wage setters formed adaptive expectations about future inflation and included these in their wage demands. At the conclusion of this lesson, students will be able to graph and analyze the effects of a policy to hold unemployment below its natural rate. The goal is for students to see the link between the Phillips Curve and the short-run aggregate supply curve.<br><font size="-10"><br /></font><font size="-3">Date Published: 01/07/2010<br />Grades: 9-12<br />Source: <a href='http://www.econedlink.org/' target='_blank'>EconEdLink.org</a></font></p><br><p><a href='http://www.econedlink.org/e355' target='_blank'>Constitution Costs</a></p><p>This lesson helps students understand the basic services provided for Americans in the United States Constitution and the necessity of a system of taxation to fund those services. Students will debate the pros and cons of having governments fund and provide particular services.<br><font size="-10"><br /></font><font size="-3">Date Published: 10/18/2002<br />Grades: 6-8, 9-12<br />Source: <a href='http://www.econedlink.org/' target='_blank'>EconEdLink.org</a></font></p><br><p><a href='http://www.econedlink.org/e352' target='_blank'>Fiscal and Monetary Policy Process</a></p><p>Students follow each step of fiscal and monetary policy processes, to see the logic of how these tools are used to correct economic instability.<br><font size="-10"><br /></font><font size="-3">Date Published: 02/26/2003<br />Grades: 9-12<br />Source: <a href='http://www.econedlink.org/' target='_blank'>EconEdLink.org</a></font></p><br><p><a href='http://www.econedlink.org/e186' target='_blank'>Online Mayhem I: Metallica Versus Napster</a></p><p>"Metallica Brings Lawsuit"; "Metallica Alleges Theft"; "Metallica Demands Napster Site Shutdown". What is Metallica's problem? As you probably know, Metallica is a rock band and the band members are upset at a web site by the name of Napster. What is it exactly that Napster does? Well, if you have downloaded any music from the Internet lately, you utilized a musical file format called MP3.<br><font size="-10"><br /></font><font size="-3">Date Published: 12/12/2000<br />Grades: 9-12<br />Source: <a href='http://www.econedlink.org/' target='_blank'>EconEdLink.org</a></font></p><br><p><a href='http://www.econedlink.org/e29' target='_blank'>Fed Orders Interest Rate Cut</a></p><p>On October 15, 1998 Alan Greenspan and the Board of Governors, in a surprise move ordered short-term interest rates cut by 0.25%. What prompted the Fed to take this action? What impact will the rate change have on the economy? Analyze the articles below to examine the linkages between actions of the Federal Reserve Bank and economic performance.<br><font size="-10"><br /></font><font size="-3">Date Published: 10/12/1998<br />Grades: 9-12<br />Source: <a href='http://www.econedlink.org/' target='_blank'>EconEdLink.org</a></font></p><br>]]></resources>
<related>
<concept>62</concept>
<concept>61</concept>
<concept>18</concept>
<concept>15</concept>
</related>
<quiz>1</quiz>
</concept>
<concept>
<id>12</id>
<name>Aggregate Supply</name>
<category>1</category>
<definition><![CDATA[<p><b>Aggregate supply</b> shows the total (or aggregate) <a href="event:function=defineGlossaryTerm,Production">production</a> of final <a href="event:function=defineGlossaryTerm,Goods">goods</a> and <a href="event:function=defineGlossaryTerm,Services">services</a> available at a range of <a href="event:function=defineGlossaryTerm,Price Level">price levels</a> for final output during a stated period of time. <a href="event:function=defineGlossaryTerm,Aggregate Supply (AS)">Aggregate supply</a> is commonly drawn as a line on a graph with total output on the horizontal axis and the price level on the vertical axis. In the <a href="event:function=defineGlossaryTerm,Short Run">short run</a>, the aggregate supply curve is drawn as upward-sloping; that is, a higher price level for outputs, holding the price of inputs fixed, will cause <a href="event:function=defineGlossaryTerm,Firms">firms</a> to produce more. In the long run, the aggregate supply curve is typically drawn as vertical; that is, in the <a href="event:function=defineGlossaryTerm,Long Run">long run</a> the prices of outputs and inputs tend to rise together, and so a higher price level for outputs doesn't cause firms to produce more output. </p> <br><p>The aggregate supply curve can increase or decrease for several reasons. As an economy expands with higher population or <a href="event:function=defineGlossaryTerm,Productivity">productivity</a> increases, aggregate supply increases; that is, at every given price level for outputs, firms will produce a greater total quantity of goods and services. Higher prices for key inputs such as <a href="event:function=defineGlossaryTerm,Labor">labor</a> or oil cause aggregate supply to decrease; that is, with higher input prices, firms will produce a lesser quantity of aggregate output for every given price level of outputs. </p> ]]></definition>
<lessons><![CDATA[<p>Below are <b>featured</b> lessons for teaching Aggregate Supply.</p><br><p class="tipHeading">High School Lessons</p><p>--------------------------------------------------------------------</p><p><a href="event:function=viewLesson,17832"><b>Unit 6: Lesson 38 - Aggregate Demand and Aggregate Supply</b></a><br><a href="event:function=viewPublication,1">Capstone: Exemplary Lessons for High School Economics - Teacher's Guide</a></p><br><p class="smaller_text">Students build their understanding of aggregate demand and aggregate supply. They use their new skills to analyze the effects of events and government monetary and fiscal policies on inflation, unemployment, and economic growth. In the first two...</p><br><p>--------------------------------------------------------------------</p><p><a href="event:function=viewLesson,850"><b><font color="#CC6666">Online Lesson:</font> Phillips Curve</b></a><br><a href='http://www.econedlink.org/' target='_blank'>EconEdLink.org</a></p><br><p class="smaller_text">This lesson explores the relationship of unemployment to inflation in the 1960s and after. Students will discover the short-run trade-off between inflation and unemployment when unemployment is less than its natural rate. Students will learn how w...</p><br><p>--------------------------------------------------------------------</p><p><a href="event:function=viewLesson,186"><b><font color="#CC6666">Online Lesson:</font> Online Mayhem I: Metallica Versus Napster</b></a><br><a href='http://www.econedlink.org/' target='_blank'>EconEdLink.org</a></p><br><p class="smaller_text">"Metallica Brings Lawsuit"; "Metallica Alleges Theft"; "Metallica Demands Napster Site Shutdown". What is Metallica's problem? As you probably know, Metallica is a rock band and the band members are upset at a web...</p><br>]]></lessons>
<tips><![CDATA[<p class="tipHeading">Tip #1</p><p>Students often confuse the aggregate supply curve with the supply curve they studied in microeconomics. The curves look similar. However, the aggregate supply curve illustrates changes in the aggregate quantity supplied in the total economy at various price levels -- not the change in quantity supplied of any one good.</p><br><p class="tipHeading">Tip #2</p><p>In the long run, the level of output or aggregate supply depends on the capital stock, the level of technology, quantity of land, natural resource endowments and the labor force. In the short run, the level of output or aggregate supply depends on the amount of labor with a given level of capital and technology. Therefore, the short-run aggregate supply curve is upward sloping while the long-run aggregate supply curve is vertical.</p><br><p class="tipHeading">Tip #3</p><p>Long-run aggregate supply is important because it represents the output of the economy when resources are fully employed at their normal intensity of use. The development of more resources will increase or shift the long-run aggregate supply curve outward. This is economic growth, and economic growth determines the future standard of living in a country. Increased investment in human and real capital and higher productivity of labor lead to economic growth. Students will vote for candidates who will support policies that encourage or discourage economic growth. Therefore, they should know the effects of different policies on economic growth.</p><br>]]></tips>
<resources><![CDATA[<p><b>Interactive tools:</b><br /></p><p><font color="#CC6666">Video</font> <a href='http://www.econedlink.org/i198' target='_blank'>Aggregate Supply</a></p><p>This video teaches the concept of Aggregate Supply. Aggregate supply shows the total (or aggregate) production of final goods and services available at a range of price levels for final output during a stated period of time.<br><font size="-10"><br /></font><font size="-3">Date Published: 07/12/2012<br>Grades: 9-12<br />Source: <a href='http://www.econedlink.org/' target='_blank'>EconEdLink.org</a></font></p><br><p><font color="#CC6666">Video</font> <a href='http://www.econedlink.org/i200' target='_blank'>Business Cycles</a></p><p>This video teaches the concept of Business Cycles. The pattern in which economies have periods of recession and then also periods of economic expansion or recovery is known as the business cycle.<br><font size="-10"><br /></font><font size="-3">Date Published: 07/12/2012<br>Grades: 3-5, 6-8, 9-12<br />Source: <a href='http://www.econedlink.org/' target='_blank'>EconEdLink.org</a></font></p><br><p><font color="#CC6666">Video</font> <a href='http://www.econedlink.org/i202' target='_blank'>Employment and Unemployment</a></p><p>This video teaches the concepts of Employment and Unemployment. Employment refers to people who have jobs while unemployment refers to people who wish to work but cannot find jobs.<br><font size="-10"><br /></font><font size="-3">Date Published: 07/12/2012<br>Source: <a href='http://www.econedlink.org/' target='_blank'>EconEdLink.org</a></font></p><br><p><font color="#CC6666">Video</font> <a href='http://www.econedlink.org/i204' target='_blank'>Gross Domestic Product (GDP)</a></p><p>This video teaches the concept of Gross Domestic Product (GDP). GDP is the total market value of all final goods and services produced within a country, usually measured over a year.<br><font size="-10"><br /></font><font size="-3">Date Published: 07/12/2012<br>Grades: 6-8, 9-12<br />Source: <a href='http://www.econedlink.org/' target='_blank'>EconEdLink.org</a></font></p><br><p><font color="#CC6666">Video</font> <a href='http://www.econedlink.org/i206' target='_blank'>Monetary Policy and the Federal Reserve</a></p><p>This video teaches the concepts of Monetary Policy and the Federal Reserve. Monetary policy involves regulating the money supply, banks and the overall financial system. Monetary policy is conducted by a central bank, which in the United States is...<br><font size="-10"><br /></font><font size="-3">Date Published: 07/12/2012<br>Grades: 3-5, 6-8, 9-12<br />Source: <a href='http://www.econedlink.org/' target='_blank'>EconEdLink.org</a></font></p><br><p>-------------------------------------</p><p><b>Lessons:</b></p><br><p><a href='http://www.econedlink.org/e850' target='_blank'>Phillips Curve</a></p><p>This lesson explores the relationship of unemployment to inflation in the 1960s and after. Students will discover the short-run trade-off between inflation and unemployment when unemployment is less than its natural rate. Students will learn how wage setters formed adaptive expectations about future inflation and included these in their wage demands. At the conclusion of this lesson, students will be able to graph and analyze the effects of a policy to hold unemployment below its natural rate. The goal is for students to see the link between the Phillips Curve and the short-run aggregate supply curve.<br><font size="-10"><br /></font><font size="-3">Date Published: 01/07/2010<br />Grades: 9-12<br />Source: <a href='http://www.econedlink.org/' target='_blank'>EconEdLink.org</a></font></p><br><p><a href='http://www.econedlink.org/e186' target='_blank'>Online Mayhem I: Metallica Versus Napster</a></p><p>"Metallica Brings Lawsuit"; "Metallica Alleges Theft"; "Metallica Demands Napster Site Shutdown". What is Metallica's problem? As you probably know, Metallica is a rock band and the band members are upset at a web site by the name of Napster. What is it exactly that Napster does? Well, if you have downloaded any music from the Internet lately, you utilized a musical file format called MP3.<br><font size="-10"><br /></font><font size="-3">Date Published: 12/12/2000<br />Grades: 9-12<br />Source: <a href='http://www.econedlink.org/' target='_blank'>EconEdLink.org</a></font></p><br>]]></resources>
<related>
<concept>62</concept>
<concept>61</concept>
<concept>18</concept>
<concept>15</concept>
</related>
<quiz>1</quiz>
</concept>
<concept>
<id>41</id>
<name>Balance of Trade and Balance of Payments</name>
<category>3</category>
<definition><![CDATA[<p>The <b><a href="event:function=defineGlossaryTerm,Balance of Trade">balance of trade</a></b> is calculated by subtracting <a href="event:function=defineGlossaryTerm,Imports">imports</a> from <a href="event:function=defineGlossaryTerm,Exports">exports</a>. The goods and services trade balance counts both exports and imports of <a href="event:function=defineGlossaryTerm,Goods">goods</a> and <a href="event:function=defineGlossaryTerm,Services">services</a>. This measure is increasingly useful because service trade has increased substantially in recent years.</p><br> <p>When exports exceed imports, a nation is said to have a trade surplus. When imports exceed exports, a nation is said to have a trade deficit. There is no reason at all for exports and imports to be evenly balanced between any two particular countries; instead, it is expected that most countries will have trade deficits with some countries and trade surpluses with other countries. It is unwise to presume that trade surpluses are always desirable and trade deficits are always undesirable. In any given year some nations are likely to have trade surpluses and others to have trade deficits. However, when a nation experiences substantial trade deficits for a sustained period of time, there is reason to be concerned that the country cannot keep consuming high levels of imported products forever. In this situation, some combination of changes in <a href="event:function=defineGlossaryTerm,Exchange Rate">exchange rates</a>, national saving and other factors will eventually curtail the trade deficits. </p><br><p>When exports occur, the flow of goods headed in one direction out of the country is matched by a flow of payments coming back into the country. Similarly, when imports occur, the flow of goods arriving in the country is matched by a flow of payments leaving the country. The <b>balance of payments</b> refers to the funds received by a country and those paid by a country for all international transactions. The <a href="event:function=defineGlossaryTerm,Balance of Payments">balance of payments</a> includes payments related to exports and imports of goods; payments related to the international flow of services, gifts or transfers; and payments for physical and financial <a href="event:function=defineGlossaryTerm,Asset">assets</a> such as rental payments or <a href="event:function=defineGlossaryTerm,Interest">interest</a> payments. It includes all transactions by the individuals, <a href="event:function=defineGlossaryTerm,Firms">firms</a> and government agencies of one nation and the rest of the world. When the balance of payments includes all inflows and outflows, by definition they must be equal--balance.</p>]]></definition>
<lessons><![CDATA[<p>Below are <b>featured</b> lessons for teaching Balance of Trade and Balance of Payments.</p><br><p class="tipHeading">High School Lessons</p><p>--------------------------------------------------------------------</p><p><a href="event:function=viewLesson,68040"><b>Lesson 14 - Economic Sanctions and U.S. Foreign Policy</b></a><br><a href="event:function=viewPublication,118">Focus: Understanding Economics in Civics and Government</a></p><br><p class="smaller_text">The students analyze cases in which the United States has imposed economic sanctions on other countries. They examine the characteristics of successful economic sanctions and apply their knowledge to predict the likelihood of the success of U.S. e...</p><br><p>--------------------------------------------------------------------</p><p><a href="event:function=viewLesson,67647"><b>Lesson 12 - Trade, Investment, and the Balance of Payments</b></a><br><a href="event:function=viewPublication,109">Focus: Globalization</a></p><br><p class="smaller_text">Students use a balance of payments account between two countries, and a hands-on activity that demonstrates the relationship between the current account and the financial account, to understand the relationship between international trade and inve...</p><br><p>--------------------------------------------------------------------</p><p><a href="event:function=viewLesson,67645"><b>Lesson 10 - Protecting the U.S. Sugar Industry from Foreign Outsourcing: A Bittersweet Idea</b></a><br><a href="event:function=viewPublication,109">Focus: Globalization</a></p><br><p class="smaller_text">Students participate in a small group activity - taking roles as consumers, producers, taxpayers, or workers - to review the costs and benefits of programs that keep U.S. prices for sugar two or three time
higher than the world price. A class deb...</p><br><p>--------------------------------------------------------------------</p><p><a href="event:function=viewLesson,65595"><b>Lesson 11: Balance of Payments</b></a><br><a href="event:function=viewPublication,69">Focus: International Economics</a></p><br><p class="smaller_text">Students learn the basic components of the balance of payments and what it means to have a balance of trade surplus or deficit, a current account surplus or deficit, a capital account surplus or deficit, a balance of payments surplus or deficit, a...</p><br><p>--------------------------------------------------------------------</p><p><a href="event:function=viewLesson,65589"><b>Lesson 5: Interpreting Trade Data: Graphs and Charts</b></a><br><a href="event:function=viewPublication,69">Focus: International Economics</a></p><br><p class="smaller_text">In this lesson students are given short readings and asked to interpret graphs displaying information about international trade. The twofold purpose is to learn how to read graphs and to understand the breadth and scope of world trade.</p><br><p>--------------------------------------------------------------------</p><p><a href="event:function=viewLesson,62476"><b>Lesson 4: International Interdependence</b></a><br><a href="event:function=viewPublication,72">Geography: Focus on Economics</a></p><br><p class="smaller_text">Students provide information about foreign-made goods that they and their families have purchased, and a master list is compiled. Then they hypothesize reasons why people buy goods made in other countries, and these reasons are also recorded. Th...</p><br> <p class="tipHeading">Middle School Lessons</p><p>--------------------------------------------------------------------</p><p><a href="event:function=viewLesson,20768"><b>Lesson 6: Trading Connections</b></a><br><a href="event:function=viewPublication,9">The Wide World of Trade</a></p><br><p class="smaller_text">Students participate in a simulation to learn how trade benefits them as individuals and how trade benefits people in different regions and countries. Working in pairs, students learn about the major import and export partners for twelve countrie...</p><br> <p>--------------------------------------------------------------------</p><p><a href="event:function=viewLesson,356"><b><font color="#CC6666">Online Lesson:</font> Taxation without Representation?</b></a><br><a href='http://www.econedlink.org/' target='_blank'>EconEdLink.org</a></p><br><p class="smaller_text">This lesson will take students through the series of tax acts that were enacted by the British government and disputed by the original 13 colonies of America prior to the American Revolution. Students will discuss the concept of government-pr...</p><br>]]></lessons>
<tips><![CDATA[<p class="tipHeading">Tip #1</p><p>Students often confuse the balance of trade with the balance of payments. The balance of payments is a broader measure of international transactions than the balance of trade. The balance of trade considers a nation's exports and imports of goods and services, while the balance of payments considers all international economic transactions including the current account, the capital account and official reserves.</p><br><p class="tipHeading">Tip #2</p><p>When discussing a nation's balance of payments, it's important to realize that it always "balances," unlike a balance of trade, which may show either a surplus or a deficit.</p><br><p class="tipHeading">Tip #3</p><p>Many students believe that the purpose of international trade is to have the highest balance-of-trade surplus possible. Ask your students if the resources of a country should be used exclusively to get little pieces of paper (money) from other countries in exchange for goods and services. Or would it be best to use the foreign exchange received by selling goods and services to other countries to buy and enjoy other goods and services from other countries? The purpose of international trade is to improve our standard of living, not to accumulate the most foreign currency or gold.</p><br>]]></tips>
<resources><![CDATA[<p><b>Interactive tools:</b><br /></p><p><font color="#CC6666">Video</font> <a href='http://www.econedlink.org/i17' target='_blank'>Making Sen$e with Paul Solman: Kenneth Rogoff Discusses U.S. Debt and China</a></p><p>Paul Solman interviews economist Kenneth Rogoff about record U.S. debt and China.<br><font size="-10"><br /></font><font size="-3">Date Published: 03/20/2009<br>Grades: 9-12<br />Source: <a href='http://www.econedlink.org/' target='_blank'>EconEdLink.org</a></font></p><br><p><font color="#CC6666">Video</font> <a href='http://www.econedlink.org/i222' target='_blank'>Balance of Trade and Balance of Payments</a></p><p>This video teaches the concepts of Balance of Trade and Balance of Payments. The balance of trade is calculated by subtracting imports from exports. The balance of payments includes payments related to exports and imports of goods; payments relate...<br><font size="-10"><br /></font><font size="-3">Date Published: 07/12/2012<br>Grades: 6-8, 9-12<br />Source: <a href='http://www.econedlink.org/' target='_blank'>EconEdLink.org</a></font></p><br><p><font color="#CC6666">Video</font> <a href='http://www.econedlink.org/i224' target='_blank'>Benefits of Trade/Comparative Advantage</a></p><p>This video teaches the concepts of Benefits of Trade and Comparative Advantage. Comparative advantage is the principle which holds that world output is higher if every country produces and trades the good in which it has a comparative advantage. ...<br><font size="-10"><br /></font><font size="-3">Date Published: 07/12/2012<br>Grades: 6-8, 9-12<br />Source: <a href='http://www.econedlink.org/' target='_blank'>EconEdLink.org</a></font></p><br><p><font color="#CC6666">Video</font> <a href='http://www.econedlink.org/i151' target='_blank'>Making Sen$e with Paul Solman: How Currency Choices 'Made in China' Have Big Impact on U.S. Economy</a></p><p>Economics correspondent Paul Solman looks at the ongoing disputes between the U.S. and China over currency valuation and trade.<br><font size="-10"><br /></font><font size="-3">Date Published: 01/18/2011<br>Grades: 9-12<br />Source: <a href='http://www.econedlink.org/' target='_blank'>EconEdLink.org</a></font></p><br><p><font color="#CC6666">Video</font> <a href='http://www.econedlink.org/i10' target='_blank'>Making Sen$e with Paul Solman: Global Trade Freezes Amid Economic Downturn</a></p><p>Economics correspondent Paul Solman reports on how the global economic crisis has impacted trade.<br><font size="-10"><br /></font><font size="-3">Date Published: 01/30/2009<br>Grades: 9-12<br />Source: <a href='http://www.econedlink.org/' target='_blank'>EconEdLink.org</a></font></p><br><p>-------------------------------------</p><p><b>Lessons:</b></p><br><p><a href='http://www.econedlink.org/e820' target='_blank'>Balance of Payments (BOP)</a></p><p>International trade allows countries to buy and sell both domestic and foreign goods, as well as services and financial assets. A country's transactions are summarized in a set of accounts called the "Balance of Payments (BOP)." Students will learn how to record transactions in the BOP accounts, and why the sum of the current account and capital account must equal zero.<br><font size="-10"><br /></font><font size="-3">Date Published: 06/02/2011<br />Grades: 9-12<br />Source: <a href='http://www.econedlink.org/' target='_blank'>EconEdLink.org</a></font></p><br><p><a href='http://www.econedlink.org/e855' target='_blank'>The Trading Game</a></p><p>In this lesson, students will learn about the gains from trade. Students will participate in a trading game that will demonstrate that trade can make everyone better off.<br><font size="-10"><br /></font><font size="-3">Date Published: 07/26/2010<br />Grades: 6-8, 9-12<br />Source: <a href='http://www.econedlink.org/' target='_blank'>EconEdLink.org</a></font></p><br><p><a href='http://www.econedlink.org/e725' target='_blank'>Transportation: They Say We Had a Revolution (Part 2)</a></p><p>Advancements in transportation have played a key role in the growth of our nation. U.S.government policies have also had a considerable impact on the development of transport as we know it today. In this series of three lessons, the students examine the advancements in automobiles, roads, airlines and airports.<br><font size="-10"><br /></font><font size="-3">Date Published: 06/03/2009<br />Grades: 6-8, 9-12<br />Source: <a href='http://www.econedlink.org/' target='_blank'>EconEdLink.org</a></font></p><br><p><a href='http://www.econedlink.org/e605' target='_blank'>Agent Pincher: The Case of the UFO</a></p><p>Agent Pincher: The Case of the UFO--Unfamiliar Foreign Objects. That is what currency from another country may look like. Sometimes when people first try to use money from another country, they feel like they are playing with toy money-it is a different size, color, and shape, compared to one's own national currency, and it often comes with unfamiliar writing. As a special agent, your job is get the facts on these UFOs and compile a profile for guide book for your section.<br><font size="-10"><br /></font><font size="-3">Date Published: 09/09/2005<br />Grades: 6-8<br />Source: <a href='http://www.econedlink.org/' target='_blank'>EconEdLink.org</a></font></p><br><p><a href='http://www.econedlink.org/e448' target='_blank'>Where Did You Come From?</a></p><p>In this multiple intelligences lesson the students figure out why the United States imports some goods that we can grow right here!<br><font size="-10"><br /></font><font size="-3">Date Published: 05/15/2003<br />Grades: 3-5<br />Source: <a href='http://www.econedlink.org/' target='_blank'>EconEdLink.org</a></font></p><br>]]></resources>
<related>
<concept>36</concept>
<concept>39</concept>
</related>
<quiz>1</quiz>
</concept>
<concept>
<id>37</id>
<name>Barriers to Trade</name>
<category>3</category>
<definition><![CDATA[<p><b>Barriers to trade</b> are government rules that block or inhibit international <a href="event:function=defineGlossaryTerm,Trade">trade</a> between countries. The most common trade restrictions are: 1) <a href="event:function=defineGlossaryTerm,Tariff">tariffs</a>, which are <a href="event:function=defineGlossaryTerm,Taxes">taxes</a> on <a href="event:function=defineGlossaryTerm,Imports">imports</a>; 2) <a href="event:function=defineGlossaryTerm,Quotas">import quotas</a>, which are limits on the quantity that can be imported; and 3) non-tariff barriers, which include administrative <a href="event:function=defineGlossaryTerm,Regulation">regulations</a> and procedures that can be used to discourage imports. Most <a href="event:function=defineGlossaryTerm,Barriers to Trade">barriers to trade</a> are designed to prevent imports from entering a country, and thus are used to protect domestic <a href="event:function=defineGlossaryTerm,Producers">producers</a> from <a href="event:function=defineGlossaryTerm,Competition">competition</a> and domestic workers from competition for their <a href="event:function=defineGlossaryTerm,Job">jobs</a>. For this reason, a policy of high barriers to trade is referred to as protectionism. However, economists point out that protectionism benefits domestic <a href="event:function=defineGlossaryTerm,Firms">firms</a> by allowing them to charge higher <a href="event:function=defineGlossaryTerm,Price">prices</a> to <a href="event:function=defineGlossaryTerm,Consumers">consumers</a>; in effect, protectionism is an implicit subsidy to the protected firms, paid for by consumers. Although trade barriers may save the jobs of some domestic <a href="event:function=defineGlossaryTerm,Workers">workers</a>, it destroys jobs in other, probably more efficient, industries.</p>]]></definition>
<lessons><![CDATA[<p>Below are <b>featured</b> lessons for teaching Barriers to Trade.</p><br><p class="tipHeading">High School Lessons</p><p>--------------------------------------------------------------------</p><p><a href="event:function=viewLesson,68040"><b>Lesson 14 - Economic Sanctions and U.S. Foreign Policy</b></a><br><a href="event:function=viewPublication,118">Focus: Understanding Economics in Civics and Government</a></p><br><p class="smaller_text">The students analyze cases in which the United States has imposed economic sanctions on other countries. They examine the characteristics of successful economic sanctions and apply their knowledge to predict the likelihood of the success of U.S. e...</p><br><p>--------------------------------------------------------------------</p><p><a href="event:function=viewLesson,67765"><b>Lesson 39: The World Trade After WWII: The EU, NAFTA, and the WTO</b></a><br><a href="event:function=viewPublication,105">Focus: Understanding Economics in U.S. History</a></p><br><p class="smaller_text">The students participate in a trading simulation that illustrates the consequences of voluntary trade among individuals in increasingly
large groups. They apply insights from this experience in an analysis of international trade after World War II...</p><br><p>--------------------------------------------------------------------</p><p><a href="event:function=viewLesson,67645"><b>Lesson 10 - Protecting the U.S. Sugar Industry from Foreign Outsourcing: A Bittersweet Idea</b></a><br><a href="event:function=viewPublication,109">Focus: Globalization</a></p><br><p class="smaller_text">Students participate in a small group activity - taking roles as consumers, producers, taxpayers, or workers - to review the costs and benefits of programs that keep U.S. prices for sugar two or three time
higher than the world price. A class deb...</p><br><p>--------------------------------------------------------------------</p><p><a href="event:function=viewLesson,15422"><b>Lesson 1 - Why People Trade</b></a><br><a href="event:function=viewPublication,2">Economics in Action: 14 Greatest Hits for Teaching High School Economics</a></p><br><p class="smaller_text">Students participate in a trading simulation and use this experience to discover the benefits of free trade. In a class discussion, they relate the simulation to concepts of regional versus universal trade, trade barriers and diminishing marginal...</p><br><p>--------------------------------------------------------------------</p><p><a href="event:function=viewLesson,65601"><b>Lesson 17: Should a Developing Country Have Free Trade?</b></a><br><a href="event:function=viewPublication,69">Focus: International Economics</a></p><br><p class="smaller_text">Students play the role of newspaper reporters in a hypothetical Latin American country; they form opinions about a protective tariff in order to write an editorial for a newspaper in the country's capital.</p><br><p>--------------------------------------------------------------------</p><p><a href="event:function=viewLesson,65593"><b>Lesson 9: Ripples: Trade Barriers and Unintended Consequences</b></a><br><a href="event:function=viewPublication,69">Focus: International Economics</a></p><br><p class="smaller_text">First in small groups and then in two large groups, students try to identify which people and organizations would support, or oppose, trade barriers on sugar imports into the United States. When these lists have been completed, the students are g...</p><br> <p>--------------------------------------------------------------------</p><p><a href="event:function=viewLesson,529"><b><font color="#CC6666">Online Lesson:</font> U.S. farmers and the Cuban embargo</b></a><br><a href='http://www.econedlink.org/' target='_blank'>EconEdLink.org</a></p><br><p class="smaller_text">This lesson explores trade barriers in general and why some U.S. farmers want one specific trade barrier, the Cuban embargo, completely eliminated.</p><br><p class="tipHeading">Middle School Lessons</p><p>--------------------------------------------------------------------</p><p><a href="event:function=viewLesson,20771"><b>Lesson 9: Why Restrict Trade?</b></a><br><a href="event:function=viewPublication,9">The Wide World of Trade</a></p><br><p class="smaller_text">Students learn some things about steel and identify a variety of products that are produced with steel. They participate in an activity to help them analyze the costs and benefits of a tariff. Students learn about special-interest groups and con...</p><br><p>--------------------------------------------------------------------</p><p><a href="event:function=viewLesson,20770"><b>Lesson 8: Something's in the Way</b></a><br><a href="event:function=viewPublication,9">The Wide World of Trade</a></p><br><p class="smaller_text">The class is divided into two groups that participate in a simulation making two types of postcards. In the first round, each group specializes and then considers possible results from trading for the postcard it didn't produce. In the second ro...</p><br><p>--------------------------------------------------------------------</p><p><a href="event:function=viewLesson,62647"><b>Lesson 17 - Don't Fence Me Out! (Barriers To Trade)</b></a><br><a href="event:function=viewPublication,49">Focus: Middle School Economics</a></p><br><p class="smaller_text">Students explore the impact of various barriers to trade and determine who gains and who loses when trade barriers are imposed.</p><br> <p>--------------------------------------------------------------------</p><p><a href="event:function=viewLesson,68"><b><font color="#CC6666">Online Lesson:</font> Don't Fence Me Out! (Barriers to Trade)</b></a><br><a href='http://www.econedlink.org/' target='_blank'>EconEdLink.org</a></p><br><p class="smaller_text">The concept of comparative advantage makes a strong case for free, unrestricted trade among nations. Yet, some people support the use of tariffs or quotas to restrict or stop the international flow of goods and services.These barriers to trad...</p><br>]]></lessons>
<tips><![CDATA[<p class="tipHeading">Tip #1</p><p>One reason people support trade barriers is because they focus on the immediate effects and ignore the secondary effects. A tariff on steel helps steelworkers and steel companies, but higher steel prices cause higher prices for goods made with steel for everyone else. If autos cost more, for example, fewer people will buy cars and autoworkers will suffer. Have the students use this logic to show the secondary effect of a tariff on steel on several different industries and the consumers of their products.</p><br><p class="tipHeading">Tip #2</p><p>Trade barriers such as tariffs and quotas limit the potential gains from trade. These barriers generally protect domestic sellers at the expense of domestic buyers. Trade barriers reduce efficiency in the allocation of scarce resources and slow economic progress.</p><br><p class="tipHeading">Tip #3</p><p>Ask the students what one imported good or service would you miss the most if it were cut off? What would their lives be like without international trade? What goods made in foreign countries do they usually enjoy?</p><br>]]></tips>
<resources><![CDATA[<p><b>Interactive tools:</b><br /></p><p><font color="#CC6666">Video</font> <a href='http://www.econedlink.org/i223' target='_blank'>Barriers to Trade</a></p><p>This video teaches the concept of Barriers to Trade. Barriers to trade are government rules that block or inhibit international trade between countries.<br><font size="-10"><br /></font><font size="-3">Date Published: 07/12/2012<br>Grades: 6-8, 9-12<br />Source: <a href='http://www.econedlink.org/' target='_blank'>EconEdLink.org</a></font></p><br><p><font color="#CC6666">Video</font> <a href='http://www.econedlink.org/i196' target='_blank'>Trade, Exchange and Interdependence</a></p><p>This video teaches the concept of Trade, Exchange and Interdependence. People do not make everything that they and their family use: that is, they do not grow all their own food, sew their own clothes, build their own house and provide themselves ...<br><font size="-10"><br /></font><font size="-3">Date Published: 07/12/2012<br>Grades: 3-5, 6-8, 9-12<br />Source: <a href='http://www.econedlink.org/' target='_blank'>EconEdLink.org</a></font></p><br><p><font color="#CC6666">Video</font> <a href='http://www.econedlink.org/i224' target='_blank'>Benefits of Trade/Comparative Advantage</a></p><p>This video teaches the concepts of Benefits of Trade and Comparative Advantage. Comparative advantage is the principle which holds that world output is higher if every country produces and trades the good in which it has a comparative advantage. ...<br><font size="-10"><br /></font><font size="-3">Date Published: 07/12/2012<br>Grades: 6-8, 9-12<br />Source: <a href='http://www.econedlink.org/' target='_blank'>EconEdLink.org</a></font></p><br><p><font color="#CC6666">Video</font> <a href='http://www.econedlink.org/i120' target='_blank'>Globalization - Lesson 1: Why is Globalization So Controversial?</a></p><p>Included in this interactive are two videos on globalization, which are based on one of the lessons from the Focus: Globalization publication. Lesson 1: Why is Globalization So Controversial? provides an overview of the major issues that have been...<br><font size="-10"><br /></font><font size="-3">Date Published: 02/16/2011<br>Grades: 9-12<br />Source: <a href='http://www.econedlink.org/' target='_blank'>EconEdLink.org</a></font></p><br><p><font color="#CC6666">Video</font> <a href='http://www.econedlink.org/i18' target='_blank'>Making Sen$e with Paul Solman: German Economic Minister Discusses Strategy</a></p><p>Germany's economic minister speaks with Paul Solman about how Europe's largest economy plans to navigate the global economic downturn.<br><font size="-10"><br /></font><font size="-3">Date Published: 03/19/2009<br>Grades: 9-12<br />Source: <a href='http://www.econedlink.org/' target='_blank'>EconEdLink.org</a></font></p><br><p>-------------------------------------</p><p><b>Lessons:</b></p><br><p><a href='http://www.econedlink.org/e529' target='_blank'>U.S. farmers and the Cuban embargo</a></p><p>This lesson explores trade barriers in general and why some U.S. farmers want one specific trade barrier, the Cuban embargo, completely eliminated.<br><font size="-10"><br /></font><font size="-3">Date Published: 05/24/2004<br />Grades: 9-12<br />Source: <a href='http://www.econedlink.org/' target='_blank'>EconEdLink.org</a></font></p><br><p><a href='http://www.econedlink.org/e68' target='_blank'>Don't Fence Me Out! (Barriers to Trade)</a></p><p>The concept of comparative advantage makes a strong case for free, unrestricted trade among nations. Yet, some people support the use of tariffs or quotas to restrict or stop the international flow of goods and services.These barriers to trade exist in most countries and have differing effects on producers and consumers in the countries involved. Recently the WTO (World Trade Organization) met in Seattle to discuss issues in trade, including trade barriers.<br><font size="-10"><br /></font><font size="-3">Date Published: 01/19/2000<br />Grades: 6-8<br />Source: <a href='http://www.econedlink.org/' target='_blank'>EconEdLink.org</a></font></p><br>]]></resources>
<related>
<concept>6</concept>
<concept>39</concept>
</related>
<quiz>1</quiz>
</concept>
<concept>
<id>39</id>
<name>Benefits of Trade/Comparative Advantage</name>
<category>3</category>
<definition><![CDATA[<p><b>Comparative advantage</b> is the principle which holds that world output is higher if every country produces and <a href="event:function=defineGlossaryTerm,Trade">trades</a> the <a href="event:function=defineGlossaryTerm,Goods">good</a> in which it has a <a href="event:function=defineGlossaryTerm,Comparative Advantage">comparative advantage</a>. A nation's comparative advantage occurs when it focuses on producing the good in which the <a href="event:function=defineGlossaryTerm,Opportunity Cost">opportunity cost</a> of production is lowest. To understand why this is so, remember that the opportunity cost is the cost of one good in terms of the reduced <a href="event:function=defineGlossaryTerm,Production">production </a>of other goods that could have been produced. When a nation focuses on producing the good at which its <a href="event:function=defineGlossaryTerm,Productivity">productivity</a> advantage is greatest, or at which its productivity disadvantage is smallest, it, in effect, chooses to produce the good for which the <a href="event:function=defineGlossaryTerm,Trade-off">trade-off</a> with other goods in terms of opportunity cost is smallest.</p><br><p>The principle of comparative advantage shows how <b>benefits of trade</b> are available to all parties who participate, both those with a productivity advantage and those with a productivity disadvantage. But it's also important to remember that international trade offers economic <a href="event:function=defineGlossaryTerm,Benefit">benefits</a> for other reasons: it increases <a href="event:function=defineGlossaryTerm,Competition">competition</a> between <a href="event:function=defineGlossaryTerm,Firms">firms</a>; it increases the variety available to <a href="event:function=defineGlossaryTerm,Consumers">consumers</a>; it often increases the level of training about matters such as accounting, management and law in low-income countries; and it disseminates new technologies and production methods.</p><br><p>To understand the intuition behind comparative advantage, consider a group of volunteers who gather to build a home. One of the volunteers is an expert builder who is better at all tasks than anyone else in the group. However, if that person has to build the house alone, it will take him or her a long time. Comparative advantage says that the skilled builder should focus on the tasks at which that person's advantage is greatest, that is, at which the person's efforts would be hardest to replace. Others should each take on the tasks at which their disadvantage is smallest. In this way, all parties can benefit from the <a href="event:function=defineGlossaryTerm,Division of Labor">division of labor</a>. Similarly, a high-productivity economy like the United States can benefit from trading with a low-productivity economy like Mexico or certain nations in Africa, because it will be better for all parties if the United States focuses on those products at which its productivity advantage is greatest, and trades with the other countries as they produce those goods in which their productivity disadvantage is least. The <a href="event:function=defineGlossaryTerm,Gains from Trade">gains from trade</a> will be largest when the parties focus on producing in their area of comparative advantage. </p> ]]></definition>
<lessons><![CDATA[<p>Below are <b>featured</b> lessons for teaching Benefits of Trade/Comparative Advantage.</p><br><p class="tipHeading">High School Lessons</p><p>--------------------------------------------------------------------</p><p><a href="event:function=viewLesson,67732"><b>Lesson 6: Specialization and Trade in the Thirteen Colonies</b></a><br><a href="event:function=viewPublication,105">Focus: Understanding Economics in U.S. History</a></p><br><p class="smaller_text">The students examine information about resources and opportunities for specialization among the New England, Middle and Southern colonies. They use a five-step process to examine the costs and benefits arising from specialization in these regions....</p><br><p>--------------------------------------------------------------------</p><p><a href="event:function=viewLesson,67640"><b>Lesson 5 - U.S. and World Trade: Past and Present</b></a><br><a href="event:function=viewPublication,109">Focus: Globalization</a></p><br><p class="smaller_text">Students conduct a class survey to learn which nations most people in their community believe are the leading U.S. trading partners, and what goods the United States exports and imports most. They then analyze current data on these questions and c...</p><br><p>--------------------------------------------------------------------</p><p><a href="event:function=viewLesson,67639"><b>Lesson 4 - Globalization and the U.S. Economy</b></a><br><a href="event:function=viewPublication,109">Focus: Globalization</a></p><br><p class="smaller_text">In this lesson students investigate the impact of globalization - especially the effects of increased international trade - on local or national culture and traditions. Given a definition of culture as a shared system of behaviors and customs, stu...</p><br><p>--------------------------------------------------------------------</p><p><a href="event:function=viewLesson,67638"><b>Lesson 3 - Finding a Comparative Advantage, Including Your Own</b></a><br><a href="event:function=viewPublication,109">Focus: Globalization</a></p><br><p class="smaller_text">Students examine trade data for U.S. exports to and imports from China, and use the data to identify both nations' comparative advantage in trading with each other. They discuss which of three possible sources of comparative advantage might lie be...</p><br><p>--------------------------------------------------------------------</p><p><a href="event:function=viewLesson,67637"><b>Lesson 2 - Why People Trade, Domestically and Internationally</b></a><br><a href="event:function=viewPublication,109">Focus: Globalization</a></p><br><p class="smaller_text">Students participate in a trading game and discuss why people trade. Then they apply the concept of comparative advantage to two hypothetical situations involving individuals and countries. They learn why both parties in voluntary trades can benef...</p><br><p>--------------------------------------------------------------------</p><p><a href="event:function=viewLesson,15434"><b>Lesson 13 - Comparative Advantage and Trade in a Global Economy</b></a><br><a href="event:function=viewPublication,2">Economics in Action: 14 Greatest Hits for Teaching High School Economics</a></p><br><p class="smaller_text">Students observe or participate in a role-play situation in which one person is better at both of two activities. They complete a work sheet that leads to the conclusion that specialization and exchange make both people better off. Then they apply...</p><br> <p>--------------------------------------------------------------------</p><p><a href="event:function=viewLesson,50"><b><font color="#CC6666">Online Lesson:</font> NAFTA: Are Jobs Being Sucked Out of the United States?</b></a><br><a href='http://www.econedlink.org/' target='_blank'>EconEdLink.org</a></p><br><p class="smaller_text">NAFTA, the North American Free Trade Agreement, went into effect on January 1, 1994. The Agreement phases out most tariffs between the United States, Canada, and Mexico. Tariffs, which are taxes on imports, increase the price of foreign goods...</p><br><p class="tipHeading">Middle School Lessons</p><p>--------------------------------------------------------------------</p><p><a href="event:function=viewLesson,60336"><b>Lesson 6 - Joining Together That Which Has Drifted Apart</b></a><br><a href="event:function=viewPublication,53">Middle School World Geography: Focus on Economics</a></p><br><p class="smaller_text">In this lesson, the students learn about the physical forces that move people on different continents further apart and the economic forces that bring them together. They read about the formation and breakup of two great continents, Laurasia and G...</p><br><p>--------------------------------------------------------------------</p><p><a href="event:function=viewLesson,20769"><b>Lesson 7: Mutual (and Comparative) Advantages</b></a><br><a href="event:function=viewPublication,9">The Wide World of Trade</a></p><br><p class="smaller_text">Using numerical examples and bar graphs, students see why it benefits two countries to specialize in the production of one of two products and then trade with each other, even if one country has the resources and technology to produce more of eith...</p><br><p>--------------------------------------------------------------------</p><p><a href="event:function=viewLesson,20768"><b>Lesson 6: Trading Connections</b></a><br><a href="event:function=viewPublication,9">The Wide World of Trade</a></p><br><p class="smaller_text">Students participate in a simulation to learn how trade benefits them as individuals and how trade benefits people in different regions and countries. Working in pairs, students learn about the major import and export partners for twelve countrie...</p><br><p>--------------------------------------------------------------------</p><p><a href="event:function=viewLesson,62646"><b>Lesson 16 - Frontier Specialists</b></a><br><a href="event:function=viewPublication,49">Focus: Middle School Economics</a></p><br><p class="smaller_text">Using a simulation about frontier families, this lesson helps students gain a understanding of the benefits of specialization and how comparative advantage forms the basis for exchange in a market economy.</p><br> <p>--------------------------------------------------------------------</p><p><a href="event:function=viewLesson,57"><b><font color="#CC6666">Online Lesson:</font> Frontier Specialists</b></a><br><a href='http://www.econedlink.org/' target='_blank'>EconEdLink.org</a></p><br><p class="smaller_text">The level of output in an economy can be increased through specialization. Economic specialization occurs when people produce different goods and services than they consume. It requires people to exchange goods and services.</p><br><p class="tipHeading">Elementary Lessons</p><p>--------------------------------------------------------------------</p><p><a href="event:function=viewLesson,20988"><b>Unit 5: Lesson 22 - Birthday Barter</b></a><br><a href="event:function=viewPublication,16">Master Curriculum Guides in Economics: Teaching Strategies - K-2</a></p><br><p class="smaller_text">Students exchange make-believe birthday presents as they learn that people can trade by barter or with money and that money makes trade easier.</p><br><p>--------------------------------------------------------------------</p><p><a href="event:function=viewLesson,20987"><b>Unit 5: Lesson 21 - His Barter is Worse Than His Bite!</b></a><br><a href="event:function=viewPublication,16">Master Curriculum Guides in Economics: Teaching Strategies - K-2</a></p><br><p class="smaller_text">Students read the story of Dan Dog and his want for a toy bear as they learn that when people trade, they expect to be better off as a result.</p><br> <p>--------------------------------------------------------------------</p><p><a href="event:function=viewLesson,226"><b><font color="#CC6666">Online Lesson:</font> What Do People Do?</b></a><br><a href='http://www.econedlink.org/' target='_blank'>EconEdLink.org</a></p><br><p class="smaller_text">Students will give examples of human resources that are producers, and identify goods and services produced by workers.</p><br>]]></lessons>
<tips><![CDATA[<p class="tipHeading">Tip #1</p><p>Comparative advantage is often confused with absolute advantage. To avoid that problem, make it clear to the students that comparative advantage is just an extension of the opportunity cost concept. When individuals and nations choose a production decision that minimizes their opportunity cost, they are functioning where they have a comparative advantage.</p><br><p class="tipHeading">Tip #2</p><p>To explain comparative advantage, use the example of the lawyer who hires an assistant to do her word processing even though the lawyer can word process faster than the assistant. Suppose the lawyer earns 10 times more per hour than her assistant, yet she can word process twice as fast. Who should do the word processing? Clearly the assistant because the opportunity cost is higher for the lawyer, who can earn 10 times as much preparing legal briefs. In economic terms, the lawyer has a comparative advantage in practicing law, and the assistant has a comparative advantage in word processing, even though the lawyer has an absolute advantage at doing both.</p><br><p class="tipHeading">Tip #3</p><p>To explain comparative advantage, ask your students if movie or sports stars should mow their own lawns. Here is an example from <i>Essentials of Economics</i> by N. Gregory Mankiw:<br><br><i><textformat leftmargin="25">Tiger Woods spends a lot of time walking around on grass. One of the most talented golfers of all time, he can hit a drive and sink a putt in a way that most casual golfers only dream of doing. Most likely, he is talented at other activities too. For example, let's imagine that Woods can mow his lawn faster than anyone else. But just because he <i>can</i> mow his law fast, does this mean he <i>should</i>?<br><br>To answer this question, we can use the concepts of opportunity cost and comparative advantage. Let's say that Woods can mow his lawn in 2 hours. In that same 2 hours, he could film a television commercial for Nike and earn $10,000. By contrast, Forrest Gump, the boy next door, can mow Woods's lawn in 4 hours. In that same 4 hours, he could work at McDonald's and earn $20.<br><br>In this example, Woods's opportunity cost of mowing the lawn is $10,000 and Forrest's opportunity cost is $20. Woods has an absolute advantage in mowing lawns because he can do the work in less time. Yet Forrest has a comparative advantage in mowing lawns because he has the lower opportunity cost.<br><br>The gains from trade in this example are tremendous. Rather than mowing his own lawn, Woods should make the commercial and hire Forrest to mow the lawn.</textformat></i></p><br>]]></tips>
<resources><![CDATA[<p><b>Interactive tools:</b><br /></p><p><font color="#CC6666">Video</font> <a href='http://www.econedlink.org/i151' target='_blank'>Making Sen$e with Paul Solman: How Currency Choices 'Made in China' Have Big Impact on U.S. Economy</a></p><p>Economics correspondent Paul Solman looks at the ongoing disputes between the U.S. and China over currency valuation and trade.<br><font size="-10"><br /></font><font size="-3">Date Published: 01/18/2011<br>Grades: 9-12<br />Source: <a href='http://www.econedlink.org/' target='_blank'>EconEdLink.org</a></font></p><br><p><font color="#CC6666">Video</font> <a href='http://www.econedlink.org/i17' target='_blank'>Making Sen$e with Paul Solman: Kenneth Rogoff Discusses U.S. Debt and China</a></p><p>Paul Solman interviews economist Kenneth Rogoff about record U.S. debt and China.<br><font size="-10"><br /></font><font size="-3">Date Published: 03/20/2009<br>Grades: 9-12<br />Source: <a href='http://www.econedlink.org/' target='_blank'>EconEdLink.org</a></font></p><br><p><font color="#CC6666">Video</font> <a href='http://www.econedlink.org/i10' target='_blank'>Making Sen$e with Paul Solman: Global Trade Freezes Amid Economic Downturn</a></p><p>Economics correspondent Paul Solman reports on how the global economic crisis has impacted trade.<br><font size="-10"><br /></font><font size="-3">Date Published: 01/30/2009<br>Grades: 9-12<br />Source: <a href='http://www.econedlink.org/' target='_blank'>EconEdLink.org</a></font></p><br><p><font color="#CC6666">Video</font> <a href='http://www.econedlink.org/i185' target='_blank'>Division of Labor/Specialization</a></p><p>This video teaches the concepts of Division of Labor and Specialization. The division of labor refers to the practice that the tasks of producing a good or service are divided up into separate tasks. When workers focus on performing separate tasks...<br><font size="-10"><br /></font><font size="-3">Date Published: 07/12/2012<br>Grades: 6-8, 9-12<br />Source: <a href='http://www.econedlink.org/' target='_blank'>EconEdLink.org</a></font></p><br><p><font color="#CC6666">Video</font> <a href='http://www.econedlink.org/i196' target='_blank'>Trade, Exchange and Interdependence</a></p><p>This video teaches the concept of Trade, Exchange and Interdependence. People do not make everything that they and their family use: that is, they do not grow all their own food, sew their own clothes, build their own house and provide themselves ...<br><font size="-10"><br /></font><font size="-3">Date Published: 07/12/2012<br>Grades: 3-5, 6-8, 9-12<br />Source: <a href='http://www.econedlink.org/' target='_blank'>EconEdLink.org</a></font></p><br><p>-------------------------------------</p><p><b>Lessons:</b></p><br><p><a href='http://www.econedlink.org/e50' target='_blank'>NAFTA: Are Jobs Being Sucked Out of the United States?</a></p><p>NAFTA, the North American Free Trade Agreement, went into effect on January 1, 1994. The Agreement phases out most tariffs between the United States, Canada, and Mexico. Tariffs, which are taxes on imports, increase the price of foreign goods and thereby benefit domestic producers. The participants in NAFTA agreed to reduce tariffs by 50 percent immediately and to reduce them to zero over the following 15 years. Industries suffering the most because of the increased competition from foreign goods would be given extra time to adjust to the elimination of tariffs on their foreign competitors' products.<br><font size="-10"><br /></font><font size="-3">Date Published: 11/28/1999<br />Grades: 9-12<br />Source: <a href='http://www.econedlink.org/' target='_blank'>EconEdLink.org</a></font></p><br><p><a href='http://www.econedlink.org/e855' target='_blank'>The Trading Game</a></p><p>In this lesson, students will learn about the gains from trade. Students will participate in a trading game that will demonstrate that trade can make everyone better off.<br><font size="-10"><br /></font><font size="-3">Date Published: 07/26/2010<br />Grades: 6-8, 9-12<br />Source: <a href='http://www.econedlink.org/' target='_blank'>EconEdLink.org</a></font></p><br><p><a href='http://www.econedlink.org/e794' target='_blank'>Should LeBron James Mow His Own Lawn?</a></p><p>This lesson will discuss absolute advantage, comparative advantage, specialization and trade with an example using professional basketball player LeBron James.<br><font size="-10"><br /></font><font size="-3">Date Published: 01/25/2011<br />Grades: 9-12<br />Source: <a href='http://www.econedlink.org/' target='_blank'>EconEdLink.org</a></font></p><br><p><a href='http://www.econedlink.org/e963' target='_blank'>Specialization and the Decathlon</a></p><p>This lesson uses results from the 2008 Summer Olympic Games to explain that athletes specialize in sports and events for which they are most skilled for the same reasons that individuals and nations specialize in the production of goods and services for which they have an absolute or a comparative advantage.<br><font size="-10"><br /></font><font size="-3">Date Published: 08/09/2011<br />Grades: 9-12<br />Source: <a href='http://www.econedlink.org/' target='_blank'>EconEdLink.org</a></font></p><br><p><a href='http://www.econedlink.org/e820' target='_blank'>Balance of Payments (BOP)</a></p><p>International trade allows countries to buy and sell both domestic and foreign goods, as well as services and financial assets. A country's transactions are summarized in a set of accounts called the "Balance of Payments (BOP)." Students will learn how to record transactions in the BOP accounts, and why the sum of the current account and capital account must equal zero.<br><font size="-10"><br /></font><font size="-3">Date Published: 06/02/2011<br />Grades: 9-12<br />Source: <a href='http://www.econedlink.org/' target='_blank'>EconEdLink.org</a></font></p><br>]]></resources>
<related>
<concept>41</concept>
<concept>37</concept>
<concept>56</concept>
<concept>6</concept>
</related>
<quiz>1</quiz>
</concept>
<concept>
<id>20</id>
<name>Budget Deficits and Public Debt</name>
<category>1</category>
<definition><![CDATA[<p>In any given year, the government collects tax revenues and makes expenditures. If <a href="event:function=defineGlossaryTerm,Taxes">taxes</a> collected exceed <a href="event:function=defineGlossaryTerm,Government Expenditures">government expenditures</a> in a given year, the government has a <a href="event:function=defineGlossaryTerm,Budget Surplus">budget surplus</a>. If taxes collected are exactly equal to expenditures in a given year, the government has a <a href="event:function=defineGlossaryTerm,Balanced Budget">balanced budget</a>. If taxes collected are less than the <a href="event:function=defineGlossaryTerm,Money">money</a> spent in a given year, the government has a <b>budget deficit</b>. When a <a href="event:function=defineGlossaryTerm,Budget Deficit">budget deficit</a> occurs, the government <a href="event:function=defineGlossaryTerm,Borrow">borrows</a> the money that it needs to finance its expenditures. For example, the U.S. government borrows by issuing Treasury bonds. </p> <br><p><b>Public debt</b> refers to the total accumulation of all the annual government deficits and/or surpluses from years past. For example, imagine that at some point in time, the government has no outstanding <a href="event:function=defineGlossaryTerm,Debt">debt</a>. Then, in the next three years, it has a budget deficit of $100 in the first year, a budget surplus of $50 in the second year and a budget deficit of $80 in the third year. Total public debt would be $130, which is the sum of the yearly deficits and surpluses. Public debt is sometimes called government debt held by the public or just government debt.</p>]]></definition>
<lessons><![CDATA[<p>Below are <b>featured</b> lessons for teaching Budget Deficits and Public Debt.</p><br><p class="tipHeading">High School Lessons</p><p>--------------------------------------------------------------------</p><p><a href="event:function=viewLesson,17830"><b>Unit 6: Lesson 36 - Should We Worry About the National Debt?</b></a><br><a href="event:function=viewPublication,1">Capstone: Exemplary Lessons for High School Economics - Teacher's Guide</a></p><br><p class="smaller_text">Students discuss the size of the current national debt and what this means. A class discussion covers the causes of the debt, how it is financed, definitions of a budget deficit and budget surplus, and the difference between a budget deficit and ...</p><br><p>--------------------------------------------------------------------</p><p><a href="event:function=viewLesson,15433"><b>Lesson 12 - Fiscal Policy: A Two-Act Play</b></a><br><a href="event:function=viewPublication,2">Economics in Action: 14 Greatest Hits for Teaching High School Economics</a></p><br><p class="smaller_text">Groups of students are given outlines for one of two acts in a play describing either expansionary or contractionary fiscal policy. After the students choose parts and prepare lines for their roles, two groups are chosen to perform the play. Stude...</p><br> <p>--------------------------------------------------------------------</p><p><a href="event:function=viewLesson,190"><b><font color="#CC6666">Online Lesson:</font> The Role of Government: The Federal Government and Fiscal Policy</b></a><br><a href='http://www.econedlink.org/' target='_blank'>EconEdLink.org</a></p><br><p class="smaller_text">Students will visit “A Citizen’s Guide to the Federal Budget,” and use the federal government web site to obtain information which will help them understand basic information about the budget of the United States Government f...</p><br><p>--------------------------------------------------------------------</p><p><a href="event:function=viewLesson,184"><b><font color="#CC6666">Online Lesson:</font> The Role of Government: The National Debt vs. The Deficit</b></a><br><a href='http://www.econedlink.org/' target='_blank'>EconEdLink.org</a></p><br><p class="smaller_text">This lesson defines and compares the National Debt with the National Deficit. Students will discover the differences between the two and look at current trends. Students will examine the amount of per-capita debt and be exposed to the reality of ...</p><br><p class="tipHeading">Middle School Lessons</p><p>--------------------------------------------------------------------</p><p><a href="event:function=viewLesson,15857"><b>Lesson 12 - Charting a Budget</b></a><br><a href="event:function=viewPublication,3">Mathematics & Economics: Connections for Life - 6-8</a></p><br><p class="smaller_text">In this lesson, students learn what a budget is. They construct a pie chart to show the distribution of expenses in a budget. They learn about payroll deductions and determine the impact that payroll deductions have on a budget. Finally, they lear...</p><br> <p>--------------------------------------------------------------------</p><p><a href="event:function=viewLesson,356"><b><font color="#CC6666">Online Lesson:</font> Taxation without Representation?</b></a><br><a href='http://www.econedlink.org/' target='_blank'>EconEdLink.org</a></p><br><p class="smaller_text">This lesson will take students through the series of tax acts that were enacted by the British government and disputed by the original 13 colonies of America prior to the American Revolution. Students will discuss the concept of government-pr...</p><br>]]></lessons>
<tips><![CDATA[<p class="tipHeading">Tip #1</p><p>There is a misconception that if the government operates with a balanced budget, its debt will be reduced. A balanced budget means that the government has no deficit, so it doesn't increase its debt. But to reduce its debt, the government would have to have a surplus at the end of a given year and use that surplus to pay down its debt.</p><br><p class="tipHeading">Tip #2</p><p>Students often confuse the federal budget deficit and the public (or federal or national) debt. The federal deficit or surplus is the difference between government expenditures and taxes for a single year. The public debt refers to the total accumulation of deficits or surpluses from years past. The opposite of public debt is a reserve. Many states and local governments have reserves. You can illustrate this by going through several hypothetical years with surpluses and deficits and showing the total public debt each year.</p><br><p class="tipHeading">Tip #3</p><p>The federal budget deficit and the public (or federal or national) debt are always at the center of political controversy. The absolute deficit for one year and the public debt should be compared to GDP in order to determine if either is too high.
Although some commentators concentrate on the absolute size of the debt, its relationship to GDP is a better measure of our ability to handle the debt. For many years the U.S.'s national debt, though large in absolute terms, was a small or shrinking proportion of the GDP. It began to grow again after 2000, and grew dramatically after the financial market meltdowns of 2007-2008.</p><br><p class="tipHeading">Tip #4</p><p>Sometimes it helps to relate the terms "deficit," "surplus" and "debt" to a personal example. If Jenny's disposable income for December is $2,000 and she spends $3,000 on holiday gifts, at the end of the month, she has a deficit. People finance their deficits by borrowing, most often from credit card companies. So Jenny now owes the credit card company $1,000. In January if Jenny still has a disposable income of $2,000 and spends $2,000, she has a balanced budget for that month. Ask the students if this means that Jenny no longer has debt. Of course, she still has debt. She owes the credit-card company $1,000. To reduce or eliminate debt, Jenny will have to have months of surplus, that is, months in which she spends less than the amount of her disposable income, and will have to use the surplus to pay down the debt (pay the credit-card bill).</p><br><p class="tipHeading">Tip #5</p><p>Students sometimes want to know if the public (or federal or national) debt will cause the United States to go bankrupt. The government is not like an individual, in that it has overwhelming power to tax, to borrow or even to create money to pay its debts. Therefore actual bankruptcy of the government is unlikely. This does not mean that the level of debt is unimportant. The government pays billions of dollars in interest on bonds used to finance the debt. This money could be used to buy other government goods and services or to reduce taxes.</p><br><p class="tipHeading">Tip #6</p><p>Sometimes students want to know to whom the public (or federal or national) debt is owed. Currently, about 74 percent of the debt is owed to U.S. citizens (individuals, businesses, and federal, state and local governments). The remainder is owed to foreign individuals, businesses, and governments.</p><br>]]></tips>
<resources><![CDATA[<p><b>Interactive tools:</b><br /></p><p><font color="#CC6666">Video</font> <a href='http://www.econedlink.org/i267' target='_blank'>Making Sen$e with Paul Solman: 'Red Ink' in the Federal Budget: Understanding Why the U.S. Has So Much Debt</a></p><p>With a federal budget of $3.6 trillion, a deficit of $1 trillion and a total debt of $16 trillion, it can be difficult to fully comprehend where all this money comes from and what the U.S. government spends it on. Paul Solman talks to The Wall Str...<br><font size="-10"><br /></font><font size="-3">Date Published: 10/25/2012<br>Grades: 9-12<br />Source: <a href='http://www.econedlink.org/' target='_blank'>EconEdLink.org</a></font></p><br><p><font color="#CC6666">Video</font> <a href='http://www.econedlink.org/i259' target='_blank'>Making Sen$e with Paul Solman: Paul Krugman's Solution to Getting Fiscal Stimulus? It Involves Aliens</a></p><p>Amid a tough economy, economist and New York Times columnist Paul Krugman has probably captured as much attention -- and notoriety -- as anyone else in his field. Part of his Making Sen$e of financial news series, Paul Solman speaks with Krugman w...<br><font size="-10"><br /></font><font size="-3">Date Published: 06/18/2012<br>Grades: 9-12<br />Source: <a href='http://www.econedlink.org/' target='_blank'>EconEdLink.org</a></font></p><br><p><font color="#CC6666">Video</font> <a href='http://www.econedlink.org/i273' target='_blank'>Making Sen$e with Paul Solman: America's Historical Struggle With Debt and the Role of Federal Government</a></p><p>Between paying now or paying later, Americans have just about always preferred debt to taxes. Paul Solman talks to Simon Johnson of the MIT Sloan School of Management about his new book "White House Burning," which chronicles the history -- includ...<br><font size="-10"><br /></font><font size="-3">Date Published: 12/12/2012<br>Grades: 9-12<br />Source: <a href='http://www.econedlink.org/' target='_blank'>EconEdLink.org</a></font></p><br><p><font color="#CC6666">Video</font> <a href='http://www.econedlink.org/i160' target='_blank'>Making Sen$e with Paul Solman: How Would Raising Debt Ceiling Impact U.S. Bond Market?</a></p><p>As part of his series on Making Sen$e of financial news, economics correspondent Paul Solman reports on how raising the debt ceiling again would affect the U.S. bond market.<br><font size="-10"><br /></font><font size="-3">Date Published: 04/13/2011<br>Grades: 9-12<br />Source: <a href='http://www.econedlink.org/' target='_blank'>EconEdLink.org</a></font></p><br><p><font color="#CC6666">Video</font> <a href='http://www.econedlink.org/i272' target='_blank'>Lawmakers Consider Cutting Tax Deductions to Bring Down the Deficit</a></p><p>While tax breaks are popular, their future may be limited. Congressional leaders are deliberating on how they can increase revenue in order to bring down the deficit, and deductions may be on the chopping block. Paul Solman explores write-offs for...<br><font size="-10"><br /></font><font size="-3">Date Published: 12/10/2012<br>Source: <a href='http://www.econedlink.org/' target='_blank'>EconEdLink.org</a></font></p><br><p>-------------------------------------</p><p><b>Lessons:</b></p><br><p><a href='http://www.econedlink.org/e190' target='_blank'>The Role of Government: The Federal Government and Fiscal Policy</a></p><p>Students will visit “A Citizen’s Guide to the Federal Budget,” and use the federal government web site to obtain information which will help them understand basic information about the budget of the United States Government for the current fiscal year.<br><font size="-10"><br /></font><font size="-3">Date Published: 01/08/2001<br />Grades: 9-12<br />Source: <a href='http://www.econedlink.org/' target='_blank'>EconEdLink.org</a></font></p><br><p><a href='http://www.econedlink.org/e184' target='_blank'>The Role of Government: The National Debt vs. The Deficit</a></p><p>This lesson defines and compares the National Debt with the National Deficit. Students will discover the differences between the two and look at current trends. Students will examine the amount of per-capita debt and be exposed to the reality of the amount the national debt is increasing every day or two despite recent budget surpluses.<br><font size="-10"><br /></font><font size="-3">Date Published: 11/20/2000<br />Grades: 9-12<br />Source: <a href='http://www.econedlink.org/' target='_blank'>EconEdLink.org</a></font></p><br><p><a href='http://www.econedlink.org/e31' target='_blank'>Social Security Gains Two More Years</a></p><p>You've heard your parents talk about Social Security, and perhaps you have a grandparent who counts on receiving a Social Security check every month. Will you be able to count on Social Security, too? Many people believe that this program which primarily provides retirement benefits is no longer a sure thing for today's young people. In this lesson we will explore that question.<br><font size="-10"><br /></font><font size="-3">Date Published: 04/16/1999<br />Grades: 9-12<br />Source: <a href='http://www.econedlink.org/' target='_blank'>EconEdLink.org</a></font></p><br><p><a href='http://www.econedlink.org/e1041' target='_blank'>Understanding the Debt Ceiling Debate and the Budget Control Act of 2011</a></p><p>This lesson provides an introduction and an overview of the Budget Control Act of 2011. Students will be given information about the legislation and presented with different proposals for dealing with the long-term deficit problem of the United States.<br><font size="-10"><br /></font><font size="-3">Date Published: 03/08/2012<br />Grades: 9-12<br />Source: <a href='http://www.econedlink.org/' target='_blank'>EconEdLink.org</a></font></p><br><p><a href='http://www.econedlink.org/e33' target='_blank'>Jesse 'The Body' Wants to Give Money Away!</a></p><p>During his campaign for governor of the State of Minnesota, former professional wrestler Jesse "The Body" Ventura, promised to return to the taxpayers of Minnesota the budget surpluses that had been accumulating in the state. Upon assuming office, Ventura revealed that the budget surplus had been spent. Governor Ventura has vowed that future surpluses will be returned to the taxpayers and not be consumed by increases in government spending. There are three competing proposals that might be considered for dealing with the budget surpluses. Prior to discussing the issues surrounding both Governor Ventura's plan and the other's, some background information on income distribution, the nature of taxation, and related issues is important.<br><font size="-10"><br /></font><font size="-3">Date Published: 04/30/1999<br />Grades: 9-12<br />Source: <a href='http://www.econedlink.org/' target='_blank'>EconEdLink.org</a></font></p><br>]]></resources>
<related>
<concept>63</concept>
</related>
<quiz>1</quiz>
</concept>
<concept>
<id>62</id>
<name>Business Cycles</name>
<category>1</category>
<definition><![CDATA[<p>Even economies which, on average, grow over time sometimes experience periods of recession, which is a significant decline in aggregate economic activity, lasting more than a few months. <a href="event:function=defineGlossaryTerm,Recession">Recession</a> can be measured with statistics like a reduced GDP, higher <a href="event:function=defineGlossaryTerm,Unemployment">unemployment</a>, a decline in industrial <a href="event:function=defineGlossaryTerm,Production">production</a> and lower sales. A popular definition of a recession is two consecutive quarters of negative GDP growth, but this definition has no official status. The pattern in which economies have periods of recession and then also periods of economic expansion or recovery is known as the <b>business cycle</b>. <a href="event:function=defineGlossaryTerm,Business Cycles">Business cycles</a> have a variety of lengths. Both recessions and expansions can be caused by some mixture of economic events and government policies. </p> <br><p>A peak is the time in the business cycle just before the economy turns down into a recession. A trough is the time in the business cycle when a recession has ended and an economic recovery or expansion has begun. Thus, the time from peak to trough measures the length of a recession, while the time from trough to peak measures the length of an economic recovery or expansion.</p>]]></definition>
<lessons><![CDATA[<p>Below are <b>featured</b> lessons for teaching Business Cycles.</p><br><p class="tipHeading">High School Lessons</p><p>--------------------------------------------------------------------</p><p><a href="event:function=viewLesson,68105"><b>Lesson 2 - How Economic Performance From 2007-2009 Compares to Other Periods in U.S. History</b></a><br><a href="event:function=viewPublication,140">Teaching Financial Crises</a></p><br><p class="smaller_text">The students examine information and data about six recessions in the United States. In small groups, they use the information to make short presentations about the recessions, highlighting data on economic performance during the time periods, and...</p><br><p>--------------------------------------------------------------------</p><p><a href="event:function=viewLesson,67756"><b>Lesson 30: Whatdunnit? The Great Depression Mystery</b></a><br><a href="event:function=viewPublication,105">Focus: Understanding Economics in U.S. History</a></p><br><p class="smaller_text">The students read a brief passage posing the basic question about the Great Depression: Why did it happen? A brief simulation activity shows how unemployment in one part of the economy can lead to unemployment in other parts of the economy. With t...</p><br><p>--------------------------------------------------------------------</p><p><a href="event:function=viewLesson,65692"><b>Lesson 9: Brother, Can You Spare a Ruble?</b></a><br><a href="event:function=viewPublication,64">From Plan to Market: Teaching Ideas for Social Studies, Economics, and Business Classes</a></p><br><p class="smaller_text">Students are introduced to business cycles through a classroom demonstration in which students are employed and unemployed. Students analyze data and think critically about why the transition economies experienced economic decline after 1989.</p><br> <p>--------------------------------------------------------------------</p><p><a href="event:function=viewLesson,979"><b><font color="#CC6666">Online Lesson:</font> Focus on Economic Data: U.S. Employment and the Unemployment Rate, December 3, 2010</b></a><br><a href='http://www.econedlink.org/' target='_blank'>EconEdLink.org</a></p><br><p class="smaller_text">This lesson examines the December 3, 2010, U.S. Department of Labor, Bureau of Labor Statistics, announcement of employment data and the unemployment rate for the month of November, 2010. This lesson introduces the basic concepts of the BLS employ...</p><br><p>--------------------------------------------------------------------</p><p><a href="event:function=viewLesson,977"><b><font color="#CC6666">Online Lesson:</font> Focus on Economic Data: U.S. Real GDP Growth, November 23, 2010</b></a><br><a href='http://www.econedlink.org/' target='_blank'>EconEdLink.org</a></p><br><p class="smaller_text">This lesson focuses on the November 23, 2010, second estimate of U.S. real gross domestic product (real GDP) growth for the third quarter (Q3) of 2010, as reported by the U.S. Bureau of Economic Analysis (BEA). The current GDP data and historical ...</p><br>]]></lessons>
<tips><![CDATA[<p class="tipHeading">Tip #1</p><p>Help your students to remember the phases of the business cycle by imagining or even acting out "the wave" commonly done at athletic events and concerts. As they envision the wave, they can also envision the various phases of the cycle. </p><br><p class="tipHeading">Tip #2</p><p>One aspect of the business cycle that may confuse students is the timing of the peak and trough phases or changes in real GDP. It is important to recognize that economists cannot tell when we are at the peak, for example, until after the economy has begun the inevitable downward slide into a recessionary period. The same is true of the trough. The time to definitively know when the economy has hit a trough is after it begins the expansionary phase.</p><br><p class="tipHeading">Tip #3</p><p>Students often learn the phases of a business cycle without knowing exactly what is cycling. The answer is real GDP. When real GDP decreases for half a year (two straight calendar quarters), that's considered a recession.</p><br><p class="tipHeading">Tip #4</p><p>Have the students bring in newspaper articles on the economy, discuss the articles and ask what phase of the business cycle we are in.</p><br>]]></tips>
<resources><![CDATA[<p><b>Interactive tools:</b><br /></p><p><font color="#CC6666">Video</font> <a href='http://www.econedlink.org/i176' target='_blank'>Making Sen$e with Paul Solman: W, V, U or L: How Is the Economic Recovery Shaping Up, Literally?</a></p><p>The latest unemployment figures out Friday reinforce the notion that the U.S. economy remains weak when compared to recoveries of the past. As part of his reporting on Making Sen$e of financial news, Paul Solman visits with economist Simon Johnson...<br><font size="-10"><br /></font><font size="-3">Date Published: 10/07/2011<br>Grades: 9-12<br />Source: <a href='http://www.econedlink.org/' target='_blank'>EconEdLink.org</a></font></p><br><p><font color="#CC6666">Flash</font> <a href='http://www.econedlink.org/i115' target='_blank'>Gen i Revolution - Mission 14: Forecasting the Future</a></p><p>This interactive tool is a part of the online personal finance game, Gen i Revolution. This is one of the fifteen "Missions" available within the online game. This Mission takes about 30 minutes to complete. To sign up to play the game, you'll nee...<br><font size="-10"><br /></font><font size="-3">Date Published: 08/14/2010<br>Grades: 6-8, 9-12<br />Source: <a href='http://www.econedlink.org/' target='_blank'>EconEdLink.org</a></font></p><br><p><font color="#CC6666">Video</font> <a href='http://www.econedlink.org/i6' target='_blank'>Making Sen$e with Paul Solman: Key Infrastructure Repairs May Boost Economy</a></p><p>Paul Solman reports on how infrastructure spending may be a crucial way to resuscitate the economy.<br><font size="-10"><br /></font><font size="-3">Date Published: 12/22/2008<br>Grades: 9-12<br />Source: <a href='http://www.econedlink.org/' target='_blank'>EconEdLink.org</a></font></p><br><p><font color="#CC6666">Video</font> <a href='http://www.econedlink.org/i200' target='_blank'>Business Cycles</a></p><p>This video teaches the concept of Business Cycles. The pattern in which economies have periods of recession and then also periods of economic expansion or recovery is known as the business cycle.<br><font size="-10"><br /></font><font size="-3">Date Published: 07/12/2012<br>Grades: 3-5, 6-8, 9-12<br />Source: <a href='http://www.econedlink.org/' target='_blank'>EconEdLink.org</a></font></p><br><p><font color="#CC6666">Video</font> <a href='http://www.econedlink.org/i259' target='_blank'>Making Sen$e with Paul Solman: Paul Krugman's Solution to Getting Fiscal Stimulus? It Involves Aliens</a></p><p>Amid a tough economy, economist and New York Times columnist Paul Krugman has probably captured as much attention -- and notoriety -- as anyone else in his field. Part of his Making Sen$e of financial news series, Paul Solman speaks with Krugman w...<br><font size="-10"><br /></font><font size="-3">Date Published: 06/18/2012<br>Grades: 9-12<br />Source: <a href='http://www.econedlink.org/' target='_blank'>EconEdLink.org</a></font></p><br><p>-------------------------------------</p><p><b>Lessons:</b></p><br><p><a href='http://www.econedlink.org/e954' target='_blank'>Jokes, Quotations, and Cartoons in Economics</a></p><p>Students will apply their knowledge of economics to the analysis and interpretation of jokes, quotations, and cartoons in economics. Students will watch a Paul Solman video of an interview of Yoram Bauman, the Stand up Economist. Students will use Daryl Cagel's cartoon website, Jokes on the Web, and news media to find economics humor and interpret.<br><font size="-10"><br /></font><font size="-3">Date Published: 07/29/2011<br />Grades: 9-12<br />Source: <a href='http://www.econedlink.org/' target='_blank'>EconEdLink.org</a></font></p><br><p><a href='http://www.econedlink.org/e859' target='_blank'>The Effects of the Recession</a></p><p>The students learn how a recession affects our economy, and how it might affect them personally.They examine the role the federal government has played in dealing with the current recession. They analyze their thoughts about what role the federal government should play in dealing with a recession.<br><font size="-10"><br /></font><font size="-3">Date Published: 10/21/2009<br />Grades: 6-8<br />Source: <a href='http://www.econedlink.org/' target='_blank'>EconEdLink.org</a></font></p><br>]]></resources>
<related>
<concept>12</concept>
<concept>13</concept>
<concept>63</concept>
<concept>18</concept>
</related>
<quiz>1</quiz>
</concept>
<concept>
<id>25</id>
<name>Competition and Market Structures</name>
<category>2</category>
<definition><![CDATA[<p>In the context of <a href="event:function=defineGlossaryTerm,Markets">markets</a>, <b><a href="event:function=defineGlossaryTerm,Competition">competition</a></b> refers to the situation when <a href="event:function=defineGlossaryTerm,Producers">producers</a> would each like to sell their <a href="event:function=defineGlossaryTerm,Goods">goods</a> or <a href="event:function=defineGlossaryTerm,Services">services</a> to the same customers. The great <a href="event:function=defineGlossaryTerm,Benefit">benefit</a> of competition is that when producers compete, they must seek to entice the consumer with a lower <a href="event:function=defineGlossaryTerm,Price">price</a> or more desirable quality. Thus, competition creates <a href="event:function=defineGlossaryTerm,Incentive">incentives</a> to find ways to produce at lower cost, to invent desirable variations on existing <a href="event:function=defineGlossaryTerm,Product">products</a> and to discover new products.</p> <br><p><b><a href="event:function=defineGlossaryTerm,Market Structure">Market structure</a></b> refers to the ways that competition occurs, based on the number of <a href="event:function=defineGlossaryTerm,Firms">firms</a>, the similarity of the products being sold and the ease of entry for new firms or exit for existing firms. Firms make different decisions about the quantities to produce and prices to charge depending on the market structure of their industry.</p><br><p>There are four main market structures. A <a href="event:function=defineGlossaryTerm,Perfect Competition">perfectly competitive</a> industry has many firms producing identical products, and it is quite easy for new firms to enter or existing firms to exit. Common examples are farm products or basic items like nuts and bolts or socks. An industry with <a href="event:function=defineGlossaryTerm,Monopolistic Competition">monopolistic competition</a> has many firms producing similar but different products, and it is quite easy for new firms to enter or existing firms to exit. Common examples include restaurants and clothing stores, which typically have a distinctive style even when they compete with each other. <a href="event:function=defineGlossaryTerm,Oligopoly">Oligopoly</a> refers to a market with a small number of firms, where additional entry is not easy. Examples are large oil producers and soft-drink companies. Finally, <a href="event:function=defineGlossaryTerm,Monopoly">monopoly</a> refers to an industry with only one producer, where additional entry is not easy. Market structure is important because the prices of goods and services and the quantities of goods and services offered are affected by the market structure in different markets and industries.</p>]]></definition>
<lessons><![CDATA[<p>Below are <b>featured</b> lessons for teaching Competition and Market Structures.</p><br><p class="tipHeading">High School Lessons</p><p>--------------------------------------------------------------------</p><p><a href="event:function=viewLesson,68035"><b>Lesson 9 - The Market Goes to Court: Key Economic Cases and the United States Supreme Court</b></a><br><a href="event:function=viewPublication,118">Focus: Understanding Economics in Civics and Government</a></p><br><p class="smaller_text">The students participate in a reader's theater activity. This activity conveys information about the role of the Supreme Court, and it introduces four types of economic cases heard by the Court. Then the students read four case studies (one of eac...</p><br><p>--------------------------------------------------------------------</p><p><a href="event:function=viewLesson,68030"><b>Lesson 4 - What Are the Economic Functions of Government?</b></a><br><a href="event:function=viewPublication,118">Focus: Understanding Economics in Civics and Government</a></p><br><p class="smaller_text">The teacher introduces six economic functions of government in a brief lecture. In a guided practice activity, the students classify newspaper headlines according to the six functions. A brief reading introduces "liberal" and "conservative" views ...</p><br><p>--------------------------------------------------------------------</p><p><a href="event:function=viewLesson,67854"><b>Lesson 6 - What Should We Do About Sweatshops?</b></a><br><a href="event:function=viewPublication,113">Teaching the Ethical Foundations of Economics</a></p><br><p class="smaller_text">This lesson introduces the students to three main ways of analyzing moral problems. The students apply these approaches to evaluate sweatshops. First, the students discuss the elements that make up a sweatshop. Then they read an essay on economics...</p><br><p>--------------------------------------------------------------------</p><p><a href="event:function=viewLesson,67751"><b>Lesson 25: The Economic Effects of the Nineteenth-Century Monopoly</b></a><br><a href="event:function=viewPublication,105">Focus: Understanding Economics in U.S. History</a></p><br><p class="smaller_text">The students are introduced to the different types of business entities: the pure competitor, monopolist and cartel. They play a game that
illustrates how difficult it can be for cartels or trusts to boost profits by colluding to reduce competitio...</p><br><p>--------------------------------------------------------------------</p><p><a href="event:function=viewLesson,67741"><b>Lesson 15:Why did the Indians of the Great Plains Invite White Americans Into Their Land?</b></a><br><a href="event:function=viewPublication,105">Focus: Understanding Economics in U.S. History</a></p><br><p class="smaller_text">The teacher introduces a mystery: Why would American Indians in the 1830s welcome contacts with white Americans? The students then participate in a simulation of trade activity among Indians, New Mexicans and American traders in
the southern Great...</p><br><p>--------------------------------------------------------------------</p><p><a href="event:function=viewLesson,60255"><b>Lesson 5: Maintaining Competition</b></a><br><a href="event:function=viewPublication,39">Focus: Institutions and Markets</a></p><br><p class="smaller_text">This lesson introduces the rationale for maintaining and strengthening competition, and illustrates the U.S. experience with antitrust laws and other government regulations and agencies. But there are costs and limits to the scope of these govern...</p><br> <p>--------------------------------------------------------------------</p><p><a href="event:function=viewLesson,759"><b><font color="#CC6666">Online Lesson:</font> Marketplace: School Competition</b></a><br><a href='http://www.econedlink.org/' target='_blank'>EconEdLink.org</a></p><br><p class="smaller_text">In June 2002, the Supreme Court ruled that Cleveland's system of giving students vouchers to attend private or religious schools did not violate the constitutional separation of church and state. In this lesson, students listen to an audio file ab...</p><br><p>--------------------------------------------------------------------</p><p><a href="event:function=viewLesson,663"><b><font color="#CC6666">Online Lesson:</font> Deceptive Advertising: Crossing the Line</b></a><br><a href='http://www.econedlink.org/' target='_blank'>EconEdLink.org</a></p><br><p class="smaller_text">Businesses use advertising to tell consumers about the goods and services they are selling. Businesses hope that their advertisements will convince people to buy their products. In this lesson, students examine the ground rules for advertisements ...</p><br><p>--------------------------------------------------------------------</p><p><a href="event:function=viewLesson,628"><b><font color="#CC6666">Online Lesson:</font> History of monopolies in the United States.</b></a><br><a href='http://www.econedlink.org/' target='_blank'>EconEdLink.org</a></p><br><p class="smaller_text">Monopolies in the United States have existed in many forms. When a business dominates a market, its market power makes it a monopoly. How these businesses use their market power will determine the legality of the monopoly.</p><br><p>--------------------------------------------------------------------</p><p><a href="event:function=viewLesson,582"><b><font color="#CC6666">Online Lesson:</font> New Sense, Inc. vs. Fish 'Till U Drop or Coase Vs. Pigou</b></a><br><a href='http://www.econedlink.org/' target='_blank'>EconEdLink.org</a></p><br><p class="smaller_text">Hot debate and arguments galore whirl around this question: "Which economic approach is the most efficient and fair to resolve utility issues surrounding the use of common or public property?" This lesson will explore, examine and analy...</p><br><p>--------------------------------------------------------------------</p><p><a href="event:function=viewLesson,505"><b><font color="#CC6666">Online Lesson:</font> Marketplace: Corporate Leap Frog</b></a><br><a href='http://www.econedlink.org/' target='_blank'>EconEdLink.org</a></p><br><p class="smaller_text">This lesson will focus on competition among sellers and the factors that can make one company more successful than another in the same market. Competition between K-Mart, Wal- Mart, and Target will be examined to see what kinds of competition...</p><br><p>--------------------------------------------------------------------</p><p><a href="event:function=viewLesson,201"><b><font color="#CC6666">Online Lesson:</font> Deregulation and the California Utilities</b></a><br><a href='http://www.econedlink.org/' target='_blank'>EconEdLink.org</a></p><br><p class="smaller_text">“The verdict is in: California’s experiment with energy deregulation is not just a mess; it’s a certifiable failure, according to everyone from the state governor to the very utilities that initially backed the scheme.&rdquo...</p><br><p>--------------------------------------------------------------------</p><p><a href="event:function=viewLesson,186"><b><font color="#CC6666">Online Lesson:</font> Online Mayhem I: Metallica Versus Napster</b></a><br><a href='http://www.econedlink.org/' target='_blank'>EconEdLink.org</a></p><br><p class="smaller_text">"Metallica Brings Lawsuit"; "Metallica Alleges Theft"; "Metallica Demands Napster Site Shutdown". What is Metallica's problem? As you probably know, Metallica is a rock band and the band members are upset at a web...</p><br><p>--------------------------------------------------------------------</p><p><a href="event:function=viewLesson,21"><b><font color="#CC6666">Online Lesson:</font> Bank Mergers Lead to Greater Business Concentration</b></a><br><a href='http://www.econedlink.org/' target='_blank'>EconEdLink.org</a></p><br><p class="smaller_text">The recent merger between NationsBank and BankAmerica will create the USA's largest bank by the end of the year. This was the third merger in the banking industry within a week, and more are rumored to come. Includes the concepts of types o...</p><br><p class="tipHeading">Middle School Lessons</p><p>--------------------------------------------------------------------</p><p><a href="event:function=viewLesson,67877"><b>Lesson 8 - Competing for Buyers</b></a><br><a href="event:function=viewPublication,115">Focus: Economics - Grades 3-5</a></p><br><p class="smaller_text">In this lesson, the students consider ways in which sellers compete to attract consumers to buy various products, such as hamburgers, movie rentals and cereal. Through the activities, the students recognize that consumers benefit from competition...</p><br><p>--------------------------------------------------------------------</p><p><a href="event:function=viewLesson,65765"><b>Lesson 11 - If We Grow More Food, Won't We Degrade the Environment?</b></a><br><a href="event:function=viewPublication,95">Economics and the Environment: Ecodetectives</a></p><br><p class="smaller_text">The students examine evidence about the impact of modern farming. They analyze the costs and benefits of modern agricultural practices, noting that the benefits derive from improved productivity. They assess the possibility that continued improvem...</p><br><p>--------------------------------------------------------------------</p><p><a href="event:function=viewLesson,15850"><b>Lesson 5 - Why Is Everyone so Crazy About Cell Phones?</b></a><br><a href="event:function=viewPublication,3">Mathematics & Economics: Connections for Life - 6-8</a></p><br><p class="smaller_text">This lesson is designed to introduce students to the benefits of competition utilizing proportions to compare different rates. The students will explore the market for cell phones in two activities. In activity one, the students are asked to solve...</p><br> <p>--------------------------------------------------------------------</p><p><a href="event:function=viewLesson,841"><b><font color="#CC6666">Online Lesson:</font> Competition Works in Our Flavor</b></a><br><a href='http://www.econedlink.org/' target='_blank'>EconEdLink.org</a></p><br><p class="smaller_text">Competition provides benefits for consumers. First, more competition means consumers have more choices of goods and services. Second, when more firms are offering goods and services, competition often leads to lower prices.</p><br><p class="tipHeading">Elementary Lessons</p><p>--------------------------------------------------------------------</p><p><a href="event:function=viewLesson,67942"><b>Lesson 21: Lunch Money</b></a><br><a href="event:function=viewPublication,116">Teaching Economics Using Children's Literature</a></p><br><p class="smaller_text">Greg is a sixth grader with a love for money. He had his first lemonade stand in second grade and is always looking for new ways to make money. Greg recently discovered that most students bring extra money to school each day, so he has decided it'...</p><br><p>--------------------------------------------------------------------</p><p><a href="event:function=viewLesson,62324"><b>Lesson 12: A Classy Competition</b></a><br><a href="event:function=viewPublication,58">Master Curriculum Guides in Economics: Teaching Strategies - 3-4</a></p><br><p class="smaller_text">People experience competition every day. Competition challenges people to try harder, practice more, and invest more time and energy in order to do their best. Competition not only encourages individuals to do their best, it also encourages busi...</p><br> <p>--------------------------------------------------------------------</p><p><a href="event:function=viewLesson,509"><b><font color="#CC6666">Online Lesson:</font> What is Competition?</b></a><br><a href='http://www.econedlink.org/' target='_blank'>EconEdLink.org</a></p><br><p class="smaller_text">Students will understand what businesses are, that a marketplace exists whenever buyers and sellers exchange goods and services, and that there is competition in the market place if you have more than one seller of the same item or similar it...</p><br><p>--------------------------------------------------------------------</p><p><a href="event:function=viewLesson,383"><b><font color="#CC6666">Online Lesson:</font> Competition: Pizza!</b></a><br><a href='http://www.econedlink.org/' target='_blank'>EconEdLink.org</a></p><br><p class="smaller_text">Students will learn about competition in the market place. They will understand that competition takes place when there are many buyers and sellers of similar products. They will discuss how competition among sellers results in lower costs an...</p><br>]]></lessons>
<tips><![CDATA[<p class="tipHeading">Tip #1</p><p>After covering the various types of market structures, ask your students to identify examples of competitive and imperfectly competitive markets in your community in order to make the definitions more concrete.</p><br><p class="tipHeading">Tip #2</p><p>Draw a continuum of market structures, going from most competitive (perfect competition) to least competitive (monopoly). Monopolistic competition and oligopoly are in the middle with oligopoly closer to monopoly. Then identify various industries and place them along the continuum.</p><br><p class="tipHeading">Tip #3</p><p>Karl Ochi, economics teacher at Washington High School in San Francisco, uses the analogy of ants spitting in a barrel to explain why perfectly competitive firms have little market power: Compare a firm in a perfectly competitive market to a 55-gallon barrel full of ants. Alone, one ant could never fill the barrel with its saliva by spitting, however hard it tried. Its "output," relative to the capacity of the barrel, is negligible and insignificant. However, if all the ants chose to spit, their collective output would be measurable and significant, and the barrel would eventually be filled with spit. Such is the case with perfectly competitive markets (barrel). The output of individual producers cannot be distinguished from that of others. An individual seller (ant) may produce and sell all the output it is capable of producing without affecting industry output and, thus, market prices. Collectively, though, all firms in the market can satisfy market demand. Individual perfectly competitive firms, relative to the market, are rather insignificant.</p><br><p class="tipHeading">Tip #4</p><p>Students frequently misunderstand the power of a monopoly. A monopoly controls the price of the product it sells. However, it does not sell the product at the highest possible price because people would not buy it. However, the price is higher and the output lower than in competitive industries. This results in a misallocation of resources. Students also associate monopolies with bigness, not oneness. Give examples of small monopolies like food at a concert or a single gas station in the middle of the desert.</p><br>]]></tips>
<resources><![CDATA[<p><b>Interactive tools:</b><br /></p><p><font color="#CC6666">Video</font> <a href='http://www.econedlink.org/i208' target='_blank'>Competition and Market Structures</a></p><p>This video teaches the concept of Competition and Market Structures. In the context of markets, competition refers to the situation when producers would each like to sell their goods or services to the same customers. The great benefit of competit...<br><font size="-10"><br /></font><font size="-3">Date Published: 07/12/2012<br>Grades: 6-8, 9-12<br />Source: <a href='http://www.econedlink.org/' target='_blank'>EconEdLink.org</a></font></p><br><p><font color="#CC6666">Video</font> <a href='http://www.econedlink.org/i274' target='_blank'>Making Sen$e with Paul Solman: How Fine Print on Your Bills Helps Big Companies in Taking More of Your Money</a></p><p>Cell phone bills are up 30 percent since 2009. So are cable television bills. Big companies are inserting tiny fees that add up to a lot and their profits do not reflect market competition. In fact, quite the opposite. Economics correspondent Paul...<br><font size="-10"><br /></font><font size="-3">Date Published: 11/28/2012<br>Grades: 9-12<br />Source: <a href='http://www.econedlink.org/' target='_blank'>EconEdLink.org</a></font></p><br><p><font color="#CC6666">Video</font> <a href='http://www.econedlink.org/i239' target='_blank'>Making Sen$e with Paul Solman: Benefit Corporations Aim to Make a Profit -- and a Positive Impact REPORT</a></p><p>Seven states have passed legislation officially recognizing companies with a conscience. Called benefit corporations, or B Corps, the firms strive to make a positive impact on society while also turning a profit. Economics correspondent Paul Solma...<br><font size="-10"><br /></font><font size="-3">Date Published: 02/29/2012<br>Grades: 9-12<br />Source: <a href='http://www.econedlink.org/' target='_blank'>EconEdLink.org</a></font></p><br><p><font color="#CC6666">Video</font> <a href='http://www.econedlink.org/i216' target='_blank'>Markets and Prices</a></p><p>This video teaches the concept of Markets and Prices. A market refers to a group of buyers and sellers for a given good or service. The price is the amount of money needed to buy a particular good or service.<br><font size="-10"><br /></font><font size="-3">Date Published: 07/12/2012<br>Grades: 6-8, 9-12<br />Source: <a href='http://www.econedlink.org/' target='_blank'>EconEdLink.org</a></font></p><br><p><font color="#CC6666">Video</font> <a href='http://www.econedlink.org/i218' target='_blank'>Producers</a></p><p>This video teaches the concept of Producers. Producers use scarce resources to produce goods and services which they offer to sell to consumers.<br><font size="-10"><br /></font><font size="-3">Date Published: 07/12/2012<br>Grades: 3-5, 6-8, 9-12<br />Source: <a href='http://www.econedlink.org/' target='_blank'>EconEdLink.org</a></font></p><br><p>-------------------------------------</p><p><b>Lessons:</b></p><br><p><a href='http://www.econedlink.org/e694' target='_blank'>What Happened to Railroads?</a></p><p>Between the Civil War and World War II, railroads were one of the nation's most important businesses and an integral part of people’s lives. In this lesson, students assume the role of detectives investigating why the rail companies experienced a crisis in the 1960s and what helped the freight transport portion of the business return to profitability later in the same century. Students analyze a set of clues that help them explore the impact of government policies and changes in consumer demand on rail service. They discover that government policies (e.g., regulations, subsidies, and taxes) can have both positive and negative consequences in the marketplace. An interactive activity helps students understand that rail service competes in two different markets—passenger service and hauling freight. Students also learn that railroads and government policies have had to adjust as the transportation industry changed in the second half of the twentieth century.<br><font size="-10"><br /></font><font size="-3">Date Published: 06/07/2007<br />Grades: 9-12<br />Source: <a href='http://www.econedlink.org/' target='_blank'>EconEdLink.org</a></font></p><br><p><a href='http://www.econedlink.org/e1018' target='_blank'>Chevy Volt...It’s Electric!</a></p><p>The costs and benefits of owning an electric or hybrid car will be evaluated in this lesson. By reading and researching the history of the production of electric cars, the lesson allows students to understand how this market has developed. Specifically, the evaluation will focus on the Chevy Volt and its attempt to compete in a constantly evolving market of automobiles. Through this lesson, students will attempt to decide whether the Volt can be competitive in price and range, as well as what incentives need to be provided to make it a more appealing purchase to consumers. There have also been several changes made to the aerodynamics of the prototype of the Volt to the first model released to consumers in order to make the battery more efficient. Finally, students will look at the supply and demand, and production of the Chevy Volt.<br><font size="-10"><br /></font><font size="-3">Date Published: 12/20/2011<br />Grades: 6-8, 9-12<br />Source: <a href='http://www.econedlink.org/' target='_blank'>EconEdLink.org</a></font></p><br><p><a href='http://www.econedlink.org/e841' target='_blank'>Competition Works in Our Flavor</a></p><p>Competition provides benefits for consumers. First, more competition means consumers have more choices of goods and services. Second, when more firms are offering goods and services, competition often leads to lower prices.<br><font size="-10"><br /></font><font size="-3">Date Published: 08/11/2009<br />Grades: 3-5, 6-8<br />Source: <a href='http://www.econedlink.org/' target='_blank'>EconEdLink.org</a></font></p><br><p><a href='http://www.econedlink.org/e647' target='_blank'>Believe it or Not?</a></p><p>Advertisements can tell consumers about prices and other information that may help them in the decisions they make about what to buy. But students also should know that ads are slanted by sellers to show a product in the best light. This lesson reveals to students how advertisers use words and images to make goods and services look their best. To protect consumers and make sure that competition among sellers is fair in the marketplace, the federal government requires that factual claims in ads be backed up with proof. Still, it is usually okay for sellers to talk only about the positives and ignore the negatives of what they are selling. Another common trick is to use exaggerated claims called “puffery.” It is up to the consumers to separate factual claims from opinions and exaggerations. This lesson challenges students to create a set of tips that could help consumers to make this distinction. Being able to tell the difference between factual claims and puffery or opinions can help consumers to make smart choices and avoid market disappointments.<br><font size="-10"><br /></font><font size="-3">Date Published: 03/03/2006<br />Grades: 3-5, 6-8<br />Source: <a href='http://www.econedlink.org/' target='_blank'>EconEdLink.org</a></font></p><br><p><a href='http://www.econedlink.org/e505' target='_blank'>Marketplace: Corporate Leap Frog</a></p><p>This lesson will focus on competition among sellers and the factors that can make one company more successful than another in the same market. Competition between K-Mart, Wal- Mart, and Target will be examined to see what kinds of competition (price and non-price) can help one company 'leap' ahead of another.<br><font size="-10"><br /></font><font size="-3">Date Published: 05/18/2004<br />Grades: 6-8, 9-12<br />Source: <a href='http://www.econedlink.org/' target='_blank'>EconEdLink.org</a></font></p><br>]]></resources>
<related>
<concept>26</concept>
<concept>67</concept>
<concept>70</concept>
</related>
<quiz>1</quiz>
</concept>
<concept>
<id>48</id>
<name>Compound Interest</name>
<category>4</category>
<definition><![CDATA[<p>Imagine that last year you <a href="event:function=defineGlossaryTerm,Investing">invested</a> $100 and receive a <a href="event:function=defineGlossaryTerm,Rate of Return">rate of return</a> after one year of 10 percent, so that you have a gain of $10. You now invest your total, the $110, and receive a rate of return of 10 percent, but at the end of this year your gain is not $10, but rather $11. The rate of return hasn't changed, so why was the gain $10 last year and $11 this year? The answer is that when you reinvest past earnings, then in the future you will earn interest not only on the original investment, but also on the past accumulated returns; this is called <a href="event:function=defineGlossaryTerm,Compound Interest">compound interest</a>.</p><br><p>The formula for compound interest, showing how much will accumulate by a certain time in the future given the original amount invested and the <a href="event:function=defineGlossaryTerm,Annual Rate of Return">annual rate of return</a>, is as follows:</p><br><p><center>Original investment(1 + rate of return)^number of years = future value</center></p><br><p>Thus, making a one-time investment of $1,000 and letting an 8 percent annual return on this investment compound for 40 years would give a future value of $1,000(1 + .08)^40 = $21,724. One lesson of compound interest is to try to <a href="event:function=defineGlossaryTerm,Save">save</a> early to build lifetime wealth, because saving in your 20s and 30s allows much more time to accumulate and thus to let the power of compound interest work than saving done in your 50s or 60s.</p> ]]></definition>
<lessons><![CDATA[<p>Below are <b>featured</b> lessons for teaching Compound Interest.</p><br><p class="tipHeading">High School Lessons</p><p>--------------------------------------------------------------------</p><p><a href="event:function=viewLesson,68287"><b>Theme 1: Lesson 1 - How to Really Be a Millionaire</b></a><br><a href="event:function=viewPublication,138">Financial Fitness for Life: 9-12 - Teacher Guide</a></p><br><p class="smaller_text">This lesson is designed to get students interested in economics and personal finance. While financial planning may seem to be dull and time-consuming, finding out how to become a millionaire is a topic likely to stir up considerable interest. Of c...</p><br><p>--------------------------------------------------------------------</p><p><a href="event:function=viewLesson,20828"><b>Lesson 14: The Mathematics of Savings</b></a><br><a href="event:function=viewPublication,11">Mathematics & Economics: Connections for Life - 9-12</a></p><br><p class="smaller_text">Because of interest compounding, establishing a commitment to personal savings early in one's professional career can yield large long-run benefits. This lesson looks at the mathematics that underlie the computations of the future value of savings...</p><br><p>--------------------------------------------------------------------</p><p><a href="event:function=viewLesson,20825"><b>Lesson 11: Cash or Annuity?</b></a><br><a href="event:function=viewPublication,11">Mathematics & Economics: Connections for Life - 9-12</a></p><br><p class="smaller_text">Jackpot winners of state lotteries may have the choice of receiving their winnings in the form of cash or an annuity. An annuity is a financial instrument that provides income at regular intervals over a specified time period. For example, New Yor...</p><br> <p>--------------------------------------------------------------------</p><p><a href="event:function=viewLesson,603"><b><font color="#CC6666">Online Lesson:</font> The Benefits of Investing Early</b></a><br><a href='http://www.econedlink.org/' target='_blank'>EconEdLink.org</a></p><br><p class="smaller_text">The students will see how compounding returns make investing at a young age pay off.</p><br><p>--------------------------------------------------------------------</p><p><a href="event:function=viewLesson,570"><b><font color="#CC6666">Online Lesson:</font> Timing Is Everything</b></a><br><a href='http://www.econedlink.org/' target='_blank'>EconEdLink.org</a></p><br><p class="smaller_text">In the first part of the lesson students examine the incentives and opportunity costs of spending and saving in a teacher directed lesson. The remainder of the lesson is an interactive web site. Students work through problems that demonstrate...</p><br><p>--------------------------------------------------------------------</p><p><a href="event:function=viewLesson,37"><b><font color="#CC6666">Online Lesson:</font> Time Value of Money</b></a><br><a href='http://www.econedlink.org/' target='_blank'>EconEdLink.org</a></p><br><p class="smaller_text">Suppose your brother or sister owed you $500. Would you rather have this money repaid to you right away, in one payment, or spread out over a year in four installment payments? Would it make a difference either way?</p><br><p class="tipHeading">Middle School Lessons</p><p>--------------------------------------------------------------------</p><p><a href="event:function=viewLesson,68167"><b>Theme 2: Lesson 4 - The Grasshopper and the Ant</b></a><br><a href="event:function=viewPublication,134">Financial Fitness for Life: Grades 3-5 - Teacher Guide</a></p><br><p class="smaller_text">In reading and discussing an adaptation of Aesop's fable 'The Grasshopper and the Ant,' the students learn about the trade-off between satisfying wants today and planning for the future. They use the fable to examine their own behavior and decisio...</p><br><p>--------------------------------------------------------------------</p><p><a href="event:function=viewLesson,67123"><b>Lesson 11: Plenty of Pennies</b></a><br><a href="event:function=viewPublication,102">Mathematics & Economics: Connections for Life - 3-5</a></p><br><p class="smaller_text">This lesson focuses on interest (economics) and percents (mathematics). The students use pennies to help them compute percents. They convert percent to decimals and figure interest amounts on savings or borrowed money. They role-play to understand...</p><br><p>--------------------------------------------------------------------</p><p><a href="event:function=viewLesson,20965"><b>Lesson 32: Choice Making</b></a><br><a href="event:function=viewPublication,15">Exploring the Marketplace: The Community Publishing Company - Teacher Resource Manual</a></p><br><p class="smaller_text">Once the books have been sold, the class decides what to do with the money left over (if any) after paying back the loan or credit and any other expenses incurred in the business. The teacher emphasizes that the money left over is payment to the ...</p><br> ]]></lessons>
<tips><![CDATA[<p class="tipHeading">Tip #1</p><p>A shortcut to finding out about how long it will take to double your money is called the Rule of 72. Divide the rate of interest you will be getting into 72. The answer will give you a ballpark figure on how long it will take for your money to double. A rate of eight percent will take about nine years to double the investment (72 divide by 8). Many students will think it would take about 12.5 years (100 divide by 8). The difference shows the power of compound interest.</p><br><p class="tipHeading">Tip #2</p><p>How important is the fact that interest compounds? Albert Einstein said that "compounding is the greatest mathematical discovery of all time." Use a children's book such as <i>The King's Chessboard</i> to demonstrate, in an exaggerated way, the value of compounding.</p><br><p class="tipHeading">Tip #3</p><p>Explain to the students that compounding can work for you or against you. If you save early and often, it works for you. If you borrow on a credit card and don't pay off the balance, it works against you.</p><br>]]></tips>
<resources><![CDATA[<p><b>Interactive tools:</b><br /></p><p><font color="#CC6666">Video</font> <a href='http://www.econedlink.org/i160' target='_blank'>Making Sen$e with Paul Solman: How Would Raising Debt Ceiling Impact U.S. Bond Market?</a></p><p>As part of his series on Making Sen$e of financial news, economics correspondent Paul Solman reports on how raising the debt ceiling again would affect the U.S. bond market.<br><font size="-10"><br /></font><font size="-3">Date Published: 04/13/2011<br>Grades: 9-12<br />Source: <a href='http://www.econedlink.org/' target='_blank'>EconEdLink.org</a></font></p><br><p><font color="#CC6666">Video</font> <a href='http://www.econedlink.org/i255' target='_blank'>Making Sen$e with Paul Solman: The State Of Student Loans: More Debt, More Defaults, More Problems</a></p><p>Americans owe $1 trillion in student loan debt. How did that happen, and what's the impact on the nation's economy? Economics correspondent Paul Solman reports as part of his Making Sen$e of financial news series.<br><font size="-10"><br /></font><font size="-3">Date Published: 05/30/2012<br>Grades: 9-12<br />Source: <a href='http://www.econedlink.org/' target='_blank'>EconEdLink.org</a></font></p><br><p><font color="#CC6666">Video</font> <a href='http://www.econedlink.org/i173' target='_blank'>Making Sen$e with Paul Solman: Amid Debt-Ceiling Drama, Interest Rates Have Hardly Followed the Script</a></p><p>On Wall Street, stocks initially rallied Monday on the news of a debt-ceiling deal, but a weak report on manufacturing killed the surge. Economics correspondent Paul Solman reports on the financial world's reactions to the drama over a debt deal a...<br><font size="-10"><br /></font><font size="-3">Date Published: 08/01/2011<br>Grades: 9-12<br />Source: <a href='http://www.econedlink.org/' target='_blank'>EconEdLink.org</a></font></p><br><p><font color="#CC6666">Flash</font> <a href='http://www.econedlink.org/i143' target='_blank'>Developing Good Credit Habits</a></p><p>In this module, students will discover the secrets to developing good credit habits and learn how long it can take to pay off a credit card balance.
The objectives are to pay off credit card debt, maintain a good credit rating by making payments ...<br><font size="-10"><br /></font><font size="-3">Date Published: 02/16/2011<br>Grades: 6-8, 9-12<br />Source: <a href='http://www.econedlink.org/' target='_blank'>EconEdLink.org</a></font></p><br><p><font color="#CC6666">Flash</font> <a href='http://www.econedlink.org/i146' target='_blank'>Saving and Investing Blitz</a></p><p>In this game, students will be asked a series of multiple choice questions. The longer it takes to answer, the less the question is worth. If they take too long, it won't be worth anything!<br><font size="-10"><br /></font><font size="-3">Date Published: 02/16/2011<br>Grades: 6-8, 9-12<br />Source: <a href='http://www.econedlink.org/' target='_blank'>EconEdLink.org</a></font></p><br><p>-------------------------------------</p><p><b>Lessons:</b></p><br><p><a href='http://www.econedlink.org/e1029' target='_blank'>A Penny Saved</a></p><p>Students will read the comic book, "A Penny Saved" published by the New York Federal Reserve Bank. Students will make the information relevant through projects, graphic organizers, teacher instruction, and problems.<br><font size="-10"><br /></font><font size="-3">Date Published: 01/03/2012<br />Grades: 9-12<br />Source: <a href='http://www.econedlink.org/' target='_blank'>EconEdLink.org</a></font></p><br><p><a href='http://www.econedlink.org/e1022' target='_blank'>Loan Amortization - Mortgage</a></p><p>How to amortize a loan using an Excel spreadsheet.<br><font size="-10"><br /></font><font size="-3">Date Published: 11/10/2011<br />Grades: 9-12<br />Source: <a href='http://www.econedlink.org/' target='_blank'>EconEdLink.org</a></font></p><br><p><a href='http://www.econedlink.org/e1057' target='_blank'>Opportunity Cost</a></p><p>Consumers are faced with tough choices because so many innovative and exciting products and services are available. Therefore, engraining a decision-making process that includes considering of opportunity cost is necessary to shape future consumer behavior.<br><font size="-10"><br /></font><font size="-3">Date Published: 01/03/2012<br />Grades: 9-12<br />Source: <a href='http://www.econedlink.org/' target='_blank'>EconEdLink.org</a></font></p><br><p><a href='http://www.econedlink.org/e1008' target='_blank'>Calculating Simple Interest</a></p><p>How do banks calculate the amount of interest paid on a loan? In this lesson, students will view a Livescribe Pencast to learn how to find the dollar amount in interest that is due at maturity. This lesson uses different time periods such as days, months, and years in the calculation as well as varying interest rates.<br><font size="-10"><br /></font><font size="-3">Date Published: 10/20/2011<br />Grades: 6-8, 9-12<br />Source: <a href='http://www.econedlink.org/' target='_blank'>EconEdLink.org</a></font></p><br><p><a href='http://www.econedlink.org/e847' target='_blank'>The Credit Card Mystery</a></p><p>Credit Cards are a risky business these days, especially for students and those holding multiple cards. Interest rates on credit card balances have always been high relative to other rates, for several reasons. Despite this, there is still a demand for the "plastic money" that many people see as convenient and ideal with the increasingly technological world economy. This lesson explores many issues surrounding credit cards- from what to look for when selecting a card to what the government is doing to aid consumers.<br><font size="-10"><br /></font><font size="-3">Date Published: 11/20/2009<br />Grades: 9-12<br />Source: <a href='http://www.econedlink.org/' target='_blank'>EconEdLink.org</a></font></p><br>]]></resources>
<related>
<concept>46</concept>
<concept>47</concept>
</related>
<quiz>1</quiz>
</concept>
<concept>
<id>68</id>
<name>Consumers</name>
<category>2</category>
<definition><![CDATA[<p><b><a href="event:function=defineGlossaryTerm,Consumers">Consumers</a></b> purchase goods and services to satisfy their <a href="event:function=defineGlossaryTerm,Economic Wants">economic wants</a>. <a href="event:function=defineGlossaryTerm,Goods">Goods</a> are tangible items that can be held or touched like clothes and cars. <a href="event:function=defineGlossaryTerm,Services">Services</a> are actions that give economic <a href="event:function=defineGlossaryTerm,Benefit">benefit</a>, such as a repaired kitchen sink or a package delivered. The concepts of consumers and <a href="event:function=defineGlossaryTerm,Consumption">consumption </a>are often introduced in the elementary grades to prepare students for a better understanding of demand. A <a href="event:function=defineGlossaryTerm,Demand">demand</a> schedule describes the behavior of consumers and illustrates the amount of a good or service that will be purchased at various <a href="event:function=defineGlossaryTerm,Price">prices</a> during a specific time period. Generally, the lower the price of something, the more of it will be purchased--and vice versa.</p> <br><p>Consumers are powerful in a <a href="event:function=defineGlossaryTerm,Market Economy">market economy</a>, and the economic <a href="event:function=defineGlossaryTerm,Choice">choices</a> of consumers in the marketplace drive the behavior of <a href="event:function=defineGlossaryTerm,Producers">producers</a>. In the words of Adam Smith, "Consumption is the sole end and purpose of all <a href="event:function=defineGlossaryTerm,Production">production</a>; and the interest of the producer ought to be attended to only so far as it may be necessary for promoting that of the consumer."</p>]]></definition>
<lessons><![CDATA[<p>Below are <b>featured</b> lessons for teaching Consumers.</p><br><p class="tipHeading">High School Lessons</p><p>--------------------------------------------------------------------</p><p><a href="event:function=viewLesson,62452"><b>Lesson 12 - Advertising: Is Consumer Sovereignty Dead?</b></a><br><a href="event:function=viewPublication,73">Personal Decision Making: Focus on Economics</a></p><br><p class="smaller_text">Students are introduced to different types of advertising as well as the role advertising plays in a modern economy. They participate in a simulation that confronts the influence that advertising has on their behavior as consumers. Finally, they...</p><br> <p>--------------------------------------------------------------------</p><p><a href="event:function=viewLesson,651"><b><font color="#CC6666">Online Lesson:</font> China - Where will they fit in the world economy?</b></a><br><a href='http://www.econedlink.org/' target='_blank'>EconEdLink.org</a></p><br><p class="smaller_text">With its, emerging middle class, its new markets, and a new emphasis on increasing its technology base, where is China going to fit in the world economy?</p><br><p>--------------------------------------------------------------------</p><p><a href="event:function=viewLesson,46"><b><font color="#CC6666">Online Lesson:</font> I'll Trade You a Bag of Chips, Two Cookies, and $60,000 for Your Tuna Fish Sandwich</b></a><br><a href='http://www.econedlink.org/' target='_blank'>EconEdLink.org</a></p><br><p class="smaller_text">Okay, so your tuna fish sandwich probably isn't worth a couple grand. It's most likely made with a type of tuna called albacore. But, on the docks in Tokyo different kind of tuna, related to the stuff in your sandwich, is sold for $70,000 dol...</p><br><p>--------------------------------------------------------------------</p><p><a href="event:function=viewLesson,43"><b><font color="#CC6666">Online Lesson:</font> National Parks: Only You Can Prevent the Coming Crisis</b></a><br><a href='http://www.econedlink.org/' target='_blank'>EconEdLink.org</a></p><br><p class="smaller_text">What do you think of when you think of the National Parks System? Do you think of the majesty of the Grand Canyon and the redwoods of Northern California? Or does the serenity of Cape Cod and the Everglades come to mind?</p><br><p class="tipHeading">Middle School Lessons</p><p>--------------------------------------------------------------------</p><p><a href="event:function=viewLesson,68248"><b>Theme 5: Lesson 17 - Comparison Shopping</b></a><br><a href="event:function=viewPublication,136">Financial Fitness for Life: Grades 6-8 - Teacher Guide</a></p><br><p class="smaller_text">The students identify costs and benefits of comparison shopping. They learn about a seven step approach that can help consumers make well-informed choices, and they practice using it. They also learn to avoid certain mistakes that consumers often ...</p><br> <p>--------------------------------------------------------------------</p><p><a href="event:function=viewLesson,58"><b><font color="#CC6666">Online Lesson:</font> What Does the Nation Consume?</b></a><br><a href='http://www.econedlink.org/' target='_blank'>EconEdLink.org</a></p><br><p class="smaller_text">This lesson will focus on what the nation consumes and how that is measured by Gross Domestic Product (GDP). In the United States, the goods and services produced for household consumption account for about two-thirds of total output.</p><br><p class="tipHeading">Elementary Lessons</p><p>--------------------------------------------------------------------</p><p><a href="event:function=viewLesson,68204"><b>Theme 3: Lesson 8 - We Are Consumers</b></a><br><a href="event:function=viewPublication,131">Financial Fitness for Life: K-2 - Teacher Guide</a></p><br><p class="smaller_text">The students discover that they are consumers. As they fill their pockets with pictures of things they want, they learn that consumers want both goods and services. As they try to help Nicholas choose a pet, and reflect on his decision, they also ...</p><br><p>--------------------------------------------------------------------</p><p><a href="event:function=viewLesson,68173"><b>Theme 3: Lesson 10 - Why Do I Want All This Stuff?</b></a><br><a href="event:function=viewPublication,134">Financial Fitness for Life: Grades 3-5 - Teacher Guide</a></p><br><p class="smaller_text">The students learn about types of advertising appeals, such as bandwagon, celebrity endorsement, and authority endorsement. They analyze ads to identify target audiences, the types of appeal used, and the facts and opinions included in the ads. Th...</p><br><p>--------------------------------------------------------------------</p><p><a href="event:function=viewLesson,68169"><b>Theme 3: Lesson 6 - Consumers Want More Goods and Services</b></a><br><a href="event:function=viewPublication,134">Financial Fitness for Life: Grades 3-5 - Teacher Guide</a></p><br><p class="smaller_text">This lesson focuses on spending decisions, particularly the decisions that students make as consumers. The activities establish a rationale for the study of financial decision making. The lesson is introduced on one day and completed after the stu...</p><br><p>--------------------------------------------------------------------</p><p><a href="event:function=viewLesson,67889"><b>Lesson 2 - A Mystery Bag of Wants</b></a><br><a href="event:function=viewPublication,114">Focus: Economics - Grades K-2</a></p><br><p class="smaller_text">In this lesson, the students consider picture clues in a "Mystery Bag of Wants" to determine what the teacher wants for the classroom. The students create individual Mystery Want bags and use the bags in a small-group activity to reinforce their u...</p><br><p>--------------------------------------------------------------------</p><p><a href="event:function=viewLesson,62321"><b>Lesson 9: A Cracker Jack Lesson</b></a><br><a href="event:function=viewPublication,58">Master Curriculum Guides in Economics: Teaching Strategies - 3-4</a></p><br><p class="smaller_text">The basic consumer problem is how to achieve maximum satisfaction given limited resources. Consumers see many goods and services they want to buy, but constraints force them to choose. Many factors influence consumer decisions, such as personal ...</p><br><p>--------------------------------------------------------------------</p><p><a href="event:function=viewLesson,20969"><b>Unit 1: Lesson 3 - Foods Around the World</b></a><br><a href="event:function=viewPublication,16">Master Curriculum Guides in Economics: Teaching Strategies - K-2</a></p><br><p class="smaller_text">Students prepare and taste foods from around the world as they learn about the different goods and services used by consumers around the world.</p><br><p>--------------------------------------------------------------------</p><p><a href="event:function=viewLesson,20968"><b>Unit 1: Lesson 2 - Consumer Reflections</b></a><br><a href="event:function=viewPublication,16">Master Curriculum Guides in Economics: Teaching Strategies - K-2</a></p><br><p class="smaller_text">Students view a very special consumer and produce life-size silhouettes as they learn that consumers use goods and services to satisfy their wants.</p><br> <p>--------------------------------------------------------------------</p><p><a href="event:function=viewLesson,509"><b><font color="#CC6666">Online Lesson:</font> What is Competition?</b></a><br><a href='http://www.econedlink.org/' target='_blank'>EconEdLink.org</a></p><br><p class="smaller_text">Students will understand what businesses are, that a marketplace exists whenever buyers and sellers exchange goods and services, and that there is competition in the market place if you have more than one seller of the same item or similar it...</p><br><p>--------------------------------------------------------------------</p><p><a href="event:function=viewLesson,310"><b><font color="#CC6666">Online Lesson:</font> Communities - What They Provide For Us</b></a><br><a href='http://www.econedlink.org/' target='_blank'>EconEdLink.org</a></p><br><p class="smaller_text">Students will learn that a job is work people do to earn a living in the world today.Students will learn the difference between jobs that provide a service and jobs that provide a good.</p><br><p>--------------------------------------------------------------------</p><p><a href="event:function=viewLesson,209"><b><font color="#CC6666">Online Lesson:</font> If I Ran the Zoo - Economics and Literature</b></a><br><a href='http://www.econedlink.org/' target='_blank'>EconEdLink.org</a></p><br><p class="smaller_text">Welcome to the Zoo! In this two-day lesson you will use Dr. Seuss' If I Ran The Zoo book to introduce the economic concepts to your students. You will also get the chance to use actual zoo criteria to help a zoo "choose" new animals.</p><br><p>--------------------------------------------------------------------</p><p><a href="event:function=viewLesson,357"><b><font color="#CC6666">Online Lesson:</font> To Market To Market</b></a><br><a href='http://www.econedlink.org/' target='_blank'>EconEdLink.org</a></p><br><p class="smaller_text">This lesson will help students become good consumers and producers by taking turns buying and selling things in a classroom-created market. Students will establish prices for items and observe what happens during the sale of those items.</p><br><p>--------------------------------------------------------------------</p><p><a href="event:function=viewLesson,41"><b><font color="#CC6666">Online Lesson:</font> Hey, Mom! What's for Breakfast?</b></a><br><a href='http://www.econedlink.org/' target='_blank'>EconEdLink.org</a></p><br><p class="smaller_text">In this lesson students working in cooperative groups will: 1.Discuss food items they consume for breakfast. 2.Investigate elements of foreign culture, particularly food. 3.Use map skills to locate selected foreign nations. 4.Increase th...</p><br>]]></lessons>
<tips><![CDATA[<p class="tipHeading">Tip #1</p><p>Young children may not view themselves as consumers, but they make consumer decisions every day. Have the students list what they spent money on in the last week. Then classify their purchases as goods or services.</p><br><p class="tipHeading">Tip #2</p><p>Ask the students what the word "consume" means. Then have a student look up the word in the dictionary and read the definition to the class (to eat, to use). Explain that consume means to use a good or service to satisfy an economic want. Finally, ask the students for a definition of "consumer" (someone who uses a good or service to satisfy an economic want).</p><br><p class="tipHeading">Tip #3</p><p>In a discussion on consuming, the issue of wants vs. needs comes up. Economists do not distinguish between wants and needs because this is a value judgment. People have many wants. Because of scarcity, people can't have everything they want so they must make choices about what goods and services to buy in order to satisfy unlimited wants. Emphasize the importance of making careful choices, and explain that different people make different choices based on their priorities. Also make sure that the students understand that choosing is also refusing.</p><br><p class="tipHeading">Tip #4</p><p>The role of the consumer in a market economy often gets lost in discussions about businesses, government, unemployment and inflation. As a result, students often see themselves (consumers) as victims of businesses. This quote from Adam Smith from <i>The Wealth of Nations</i> makes it clear that an economic system should be judged on how well it satisfies the desires of consumers: "Consumption is the sole end and purpose of all production; and the interest of the producer ought to be attended to, only so far as it may be necessary for promoting that of the consumer. The maxim is so perfectly self-evident, that it would be absurd to attempt to prove it. But in the mercantile system, the interest of the consumer is almost constantly sacrificed to that of the producer; and it seems to consider production, and not consumption, as the ultimate end and object of all industry and commerce." Point out that products that consumers don't want (such as Blue Pepsi and New Coke) don't last in the marketplace. In recent years, technology has provided companies with tools to better understand their customers? preferences and avoid these types of gaffs. As an example, Mountain Dew recently allowed their customers to vote for new flavors online while other firms have used social networking web sites to better understand what their customers are looking for.</p><br>]]></tips>
<resources><![CDATA[<p><b>Interactive tools:</b><br /></p><p><font color="#CC6666">Video</font> <a href='http://www.econedlink.org/i98' target='_blank'>Making Sen$e with Paul Solman: Did Greek Cuisine Foreshadow Economic Problems?</a></p><p>A food writer sees parallels between Greece's crushing economic problems and its departure from its simple, humble culinary roots. Paul Solman reports.<br><font size="-10"><br /></font><font size="-3">Date Published: 08/11/2010<br>Grades: 9-12<br />Source: <a href='http://www.econedlink.org/' target='_blank'>EconEdLink.org</a></font></p><br><p><font color="#CC6666">Video</font> <a href='http://www.econedlink.org/i87' target='_blank'>Making Sen$e with Paul Solman: Cleveland's Basketball Boon Brings Economic Vigor</a></p><p>Paul Solman explores the massive economic impact an upcoming decision by NBA superstar Lebron James will have on Cleveland.<br><font size="-10"><br /></font><font size="-3">Date Published: 06/24/2010<br>Grades: 9-12<br />Source: <a href='http://www.econedlink.org/' target='_blank'>EconEdLink.org</a></font></p><br><p><font color="#CC6666">Video</font> <a href='http://www.econedlink.org/i40' target='_blank'>Making Sen$e with Paul Solman: The High Cost of Discount Culture in the U.S.</a></p><p>Economic correspondent Paul Solman looks at the effects of Americans' obsession with low prices as part of his "Making Sense"" series."<br><font size="-10"><br /></font><font size="-3">Date Published: 08/10/2009<br>Grades: 9-12<br />Source: <a href='http://www.econedlink.org/' target='_blank'>EconEdLink.org</a></font></p><br><p><font color="#CC6666">Video</font> <a href='http://www.econedlink.org/i24' target='_blank'>Making Sen$e with Paul Solman: In Slumping Economy, a Shift in Shopping Habits</a></p><p>Economics correspondent Paul Solman talks to author Paco Underhill about how consumer habits have changed in the recession.<br><font size="-10"><br /></font><font size="-3">Date Published: 04/24/2009<br>Grades: 9-12<br />Source: <a href='http://www.econedlink.org/' target='_blank'>EconEdLink.org</a></font></p><br><p><font color="#CC6666">Video</font> <a href='http://www.econedlink.org/i23' target='_blank'>Making Sen$e with Paul Solman: Paul Solman Explores The 'Paradox of Thrift'</a></p><p>Paul Solman examines how the consumers who decide to save their money instead of spending it may exacerbate the effects of the economic downturn.<br><font size="-10"><br /></font><font size="-3">Date Published: 04/15/2009<br>Grades: 9-12<br />Source: <a href='http://www.econedlink.org/' target='_blank'>EconEdLink.org</a></font></p><br><p>-------------------------------------</p><p><b>Lessons:</b></p><br><p><a href='http://www.econedlink.org/e1057' target='_blank'>Opportunity Cost</a></p><p>Consumers are faced with tough choices because so many innovative and exciting products and services are available. Therefore, engraining a decision-making process that includes considering of opportunity cost is necessary to shape future consumer behavior.<br><font size="-10"><br /></font><font size="-3">Date Published: 01/03/2012<br />Grades: 9-12<br />Source: <a href='http://www.econedlink.org/' target='_blank'>EconEdLink.org</a></font></p><br><p><a href='http://www.econedlink.org/e954' target='_blank'>Jokes, Quotations, and Cartoons in Economics</a></p><p>Students will apply their knowledge of economics to the analysis and interpretation of jokes, quotations, and cartoons in economics. Students will watch a Paul Solman video of an interview of Yoram Bauman, the Stand up Economist. Students will use Daryl Cagel's cartoon website, Jokes on the Web, and news media to find economics humor and interpret.<br><font size="-10"><br /></font><font size="-3">Date Published: 07/29/2011<br />Grades: 9-12<br />Source: <a href='http://www.econedlink.org/' target='_blank'>EconEdLink.org</a></font></p><br><p><a href='http://www.econedlink.org/e847' target='_blank'>The Credit Card Mystery</a></p><p>Credit Cards are a risky business these days, especially for students and those holding multiple cards. Interest rates on credit card balances have always been high relative to other rates, for several reasons. Despite this, there is still a demand for the "plastic money" that many people see as convenient and ideal with the increasingly technological world economy. This lesson explores many issues surrounding credit cards- from what to look for when selecting a card to what the government is doing to aid consumers.<br><font size="-10"><br /></font><font size="-3">Date Published: 11/20/2009<br />Grades: 9-12<br />Source: <a href='http://www.econedlink.org/' target='_blank'>EconEdLink.org</a></font></p><br><p><a href='http://www.econedlink.org/e651' target='_blank'>China - Where will they fit in the world economy?</a></p><p>With its, emerging middle class, its new markets, and a new emphasis on increasing its technology base, where is China going to fit in the world economy?<br><font size="-10"><br /></font><font size="-3">Date Published: 11/10/2006<br />Grades: 9-12<br />Source: <a href='http://www.econedlink.org/' target='_blank'>EconEdLink.org</a></font></p><br><p><a href='http://www.econedlink.org/e509' target='_blank'>What is Competition?</a></p><p>Students will understand what businesses are, that a marketplace exists whenever buyers and sellers exchange goods and services, and that there is competition in the market place if you have more than one seller of the same item or similar items.<br><font size="-10"><br /></font><font size="-3">Date Published: 12/17/2003<br />Grades: K-2, 3-5<br />Source: <a href='http://www.econedlink.org/' target='_blank'>EconEdLink.org</a></font></p><br>]]></resources>
<related>
<concept>23</concept>
<concept>27</concept>
</related>
<quiz>1</quiz>
</concept>
<concept>
<id>46</id>
<name>Credit</name>
<category>4</category>
<definition><![CDATA[<p><b>Credit</b> refers to the ability to <a href="event:function=defineGlossaryTerm,Borrow">borrow</a> money. Some forms of <a href="event:function=defineGlossaryTerm,Credit">credit</a> commonly used by <a href="event:function=defineGlossaryTerm,Consumers">consumers</a> are car loans, home <a href="event:function=defineGlossaryTerm,Mortgage">mortgage</a> loans and <a href="event:function=defineGlossaryTerm,Credit Card">credit cards</a>. <a href="event:function=defineGlossaryTerm,Firms">Firms</a> also use credit regularly, either by borrowing from a <a href="event:function=defineGlossaryTerm,Bank">bank</a> or issuing corporate <a href="event:function=defineGlossaryTerm,Bond">bonds</a>. Government also uses credit when it needs to borrow <a href="event:function=defineGlossaryTerm,Money">money </a>to finance a <a href="event:function=defineGlossaryTerm,Budget">budget</a> deficit. Those who can borrow moderate or large sums of money at a reasonable rate of <a href="event:function=defineGlossaryTerm,Interest">interest </a>are sometimes said to have good credit, while those who cannot borrow such amounts at such rates are said to have bad credit.</p> <br><p>Credit is extremely useful to the economy. Most people would have great difficulty in buying a house if they couldn't borrow the money. Many people also use credit to further their education. Many firms would be unable to build new factories if they had to <a href="event:function=defineGlossaryTerm,Save">save</a> all the money first. In addition, short-term credit is often used by people (through credit cards) and firms as a simple and convenient method of paying for purchases. </p> <br><p>However, excessive borrowing can be a problem for <a href="event:function=defineGlossaryTerm,Households">households</a>, firms and government. Making interest payments because you borrowed money for the house that you live in, a car that you drive or a factory that produces goods can make good economic sense. But credit should not be used to pay for <a href="event:function=defineGlossaryTerm,Goods">goods</a> or <a href="event:function=defineGlossaryTerm,Consumption">consumption</a> in the present that were completely consumed in the past. Be careful if the loan lasts longer than the item you bought with it.</p>]]></definition>
<lessons><![CDATA[<p>Below are <b>featured</b> lessons for teaching Credit.</p><br><p class="tipHeading">High School Lessons</p><p>--------------------------------------------------------------------</p><p><a href="event:function=viewLesson,68303"><b>Theme 4: Lesson 17 - Shopping for an Auto Loan</b></a><br><a href="event:function=viewPublication,138">Financial Fitness for Life: 9-12 - Teacher Guide</a></p><br><p class="smaller_text">Wise consumers shop for credit just as they might shop for a car or a computer. In this lesson, to begin learning the skills needed in shopping for credit, the students fill out a credit-comparison chart for a hypothetical auto loan. Then, using t...</p><br><p>--------------------------------------------------------------------</p><p><a href="event:function=viewLesson,68300"><b>Theme 4: Lesson 14 - All About Interest</b></a><br><a href="event:function=viewPublication,138">Financial Fitness for Life: 9-12 - Teacher Guide</a></p><br><p class="smaller_text">To compare the cost of different loans, students must understand finance charges and interest rates. In this lesson, the students learn how to compute finance charges, how to differentiate between add-on and annual percentage rates, and how the an...</p><br><p>--------------------------------------------------------------------</p><p><a href="event:function=viewLesson,68111"><b>Lesson 8 - Understanding Financial Markets, 2007-2009</b></a><br><a href="event:function=viewPublication,140">Teaching Financial Crises</a></p><br><p class="smaller_text">This lesson pulls together the events in financial markets from 2007 to 2009 by examining the persons and financial institutions that played key roles in the crisis, including why it occurred, who was affected, and the aftermath. How better to und...</p><br><p>--------------------------------------------------------------------</p><p><a href="event:function=viewLesson,68110"><b>Lesson 7 - The Instruments and Institutions of Modern Financial Markets</b></a><br><a href="event:function=viewPublication,140">Teaching Financial Crises</a></p><br><p class="smaller_text">Students work in small groups to make flash cards to display terms commonly used in modern financial markets. Each group of students begins by learning one group of terms. The students pass their flash cards from group to group until everyone has ...</p><br><p>--------------------------------------------------------------------</p><p><a href="event:function=viewLesson,17812"><b>Unit 3: Lesson 18 - Credit Management</b></a><br><a href="event:function=viewPublication,1">Capstone: Exemplary Lessons for High School Economics - Teacher's Guide</a></p><br><p class="smaller_text">This lesson is designed to help students make good consumer-credit decisions. Although using credit is beneficial at times, it often carries higher costs than many people realize. This lesson discusses the costs of credit in a manner that helps ...</p><br><p>--------------------------------------------------------------------</p><p><a href="event:function=viewLesson,20829"><b>Lesson 15: The Mathematics of Credit Card Interest and Fixed Payments</b></a><br><a href="event:function=viewPublication,11">Mathematics & Economics: Connections for Life - 9-12</a></p><br><p class="smaller_text">It is common for a high school student to receive multiple invitations to enroll for a credit card. In fact, an increasing number of high school students even carry credit cards. One goal of this lesson is to try to uncover some of the mathematics...</p><br><p>--------------------------------------------------------------------</p><p><a href="event:function=viewLesson,62450"><b>Lesson 10 - Consumer Credit: Buy Now, Pay Later, and More</b></a><br><a href="event:function=viewPublication,73">Personal Decision Making: Focus on Economics</a></p><br><p class="smaller_text">Through group activity, students analyze the costs and benefits of using credit cards to purchase goods and services.</p><br> <p>--------------------------------------------------------------------</p><p><a href="event:function=viewLesson,847"><b><font color="#CC6666">Online Lesson:</font> The Credit Card Mystery</b></a><br><a href='http://www.econedlink.org/' target='_blank'>EconEdLink.org</a></p><br><p class="smaller_text">Credit Cards are a risky business these days, especially for students and those holding multiple cards. Interest rates on credit card balances have always been high relative to other rates, for several reasons. Despite this, there is still a deman...</p><br><p>--------------------------------------------------------------------</p><p><a href="event:function=viewLesson,326"><b><font color="#CC6666">Online Lesson:</font> Credit for Beginners</b></a><br><a href='http://www.econedlink.org/' target='_blank'>EconEdLink.org</a></p><br><p class="smaller_text">This lesson focuses on teaching students the basics about credit. It explains why credit is important, how to keep good credit and several of the terms that are associated with credit.</p><br><p>--------------------------------------------------------------------</p><p><a href="event:function=viewLesson,346"><b><font color="#CC6666">Online Lesson:</font> Q T Pi Fashions - Learning About Credit Card Use</b></a><br><a href='http://www.econedlink.org/' target='_blank'>EconEdLink.org</a></p><br><p class="smaller_text">Credit cards are convenient, user friendly, and at times dangerous. In this lesson students learn the joys and dangers of using credit as they help Credit, the main character in this activity, solve her credit problems.</p><br><p>--------------------------------------------------------------------</p><p><a href="event:function=viewLesson,8301"><b><font color="#CC6666">Online Lesson:</font> Getting and Using a Credit Card</b></a><br><a href='http://www.econedlink.org/' target='_blank'>EconEdLink.org</a></p><br><p class="smaller_text">Students will read the "Credit Counselor" guide to learn about the costs and benefits of credit cards; the C's of credit; credit history; credit application evaluation; and become familiar with some useful formulas. They will need to complete the ...</p><br><p>--------------------------------------------------------------------</p><p><a href="event:function=viewLesson,188"><b><font color="#CC6666">Online Lesson:</font> My Credit Rating: Why Should I Care?</b></a><br><a href='http://www.econedlink.org/' target='_blank'>EconEdLink.org</a></p><br><p class="smaller_text">Credit is a wonderful tool for the consumer. It can enhance your quality of life. It enables you to buy and enjoy a purchase before you have the money to pay for it. On the other hand, it can create serious problems for people who use it incorrectly.</p><br><p>--------------------------------------------------------------------</p><p><a href="event:function=viewLesson,175"><b><font color="#CC6666">Online Lesson:</font> The Costs of Credit</b></a><br><a href='http://www.econedlink.org/' target='_blank'>EconEdLink.org</a></p><br><p class="smaller_text">"Will that be cash, check, debit, or credit?" This lesson plan explores the difference between these. What is the difference? Is using credit the same as paying with cash? Or by check? Or by debit card? Some young people believe that usi...</p><br><p class="tipHeading">Middle School Lessons</p><p>--------------------------------------------------------------------</p><p><a href="event:function=viewLesson,68247"><b>Theme 5: Lesson 16 - Establishing Credit</b></a><br><a href="event:function=viewPublication,136">Financial Fitness for Life: Grades 6-8 - Teacher Guide</a></p><br><p class="smaller_text">Lenders are in business to grant loans to individuals and businesses. However, the applicant's ability to repay a loan can mean the difference between profit and loss for the lender. To reduce risk, the lender assesses the applicant's creditworthi...</p><br><p>--------------------------------------------------------------------</p><p><a href="event:function=viewLesson,68246"><b>Theme 5: Lesson 15 - Cash or Credit?</b></a><br><a href="event:function=viewPublication,136">Financial Fitness for Life: Grades 6-8 - Teacher Guide</a></p><br><p class="smaller_text">Most students are aware of the variety of payment options available to consumers. Cash, checks, debit cards, and credit cards are often used by their parents; however, the students probably do not understand the implications of each. This lesson e...</p><br><p>--------------------------------------------------------------------</p><p><a href="event:function=viewLesson,67878"><b>Lesson 9 - Bulletin-Board Banking</b></a><br><a href="event:function=viewPublication,115">Focus: Economics - Grades 3-5</a></p><br><p class="smaller_text">In this lesson, the students participate in activities that demonstrate the role of banks in a community. They learn that banks facilitate community growth by receiving funds from savers and transferring a portion of those funds to borrowers. Th...</p><br><p>--------------------------------------------------------------------</p><p><a href="event:function=viewLesson,15851"><b>Lesson 6 - How Much is That Bike?</b></a><br><a href="event:function=viewPublication,3">Mathematics & Economics: Connections for Life - 6-8</a></p><br><p class="smaller_text">This lesson demonstrates the utility of percentages in comparing fractions of unequal size; it also provides students with practice in using percent to calculate simple interest. Students are introduced to the idea of buying on credit and the addi...</p><br><p>--------------------------------------------------------------------</p><p><a href="event:function=viewLesson,62645"><b>Lesson 15 - Savers And Borrowers</b></a><br><a href="event:function=viewPublication,49">Focus: Middle School Economics</a></p><br><p class="smaller_text">In this lesson, students encounter difficulties in lending and borrowing. They identify financial institutions as effective intermediaries in this process. In closure they discuss the role credit can have on the growth of a community.</p><br> <p class="tipHeading">Elementary Lessons</p><p>--------------------------------------------------------------------</p><p><a href="event:function=viewLesson,68210"><b>Theme 4: Lesson 14 - We Owe Money</b></a><br><a href="event:function=viewPublication,131">Financial Fitness for Life: K-2 - Teacher Guide</a></p><br><p class="smaller_text">The students explore uses of credit. They assume the role of the Wild Wanter and determine the amount of credit needed to satisfy their wants when income is limited. They construct a Pay Cube to show some of the ways consumers pay for goods and se...</p><br><p>--------------------------------------------------------------------</p><p><a href="event:function=viewLesson,68209"><b>Theme 4: Lesson 13 - We Are Lenders</b></a><br><a href="event:function=viewPublication,131">Financial Fitness for Life: K-2 - Teacher Guide</a></p><br><p class="smaller_text">This lesson focuses on the relationship between borrowers and lenders, from the perspective of the lender. Using the Pocket Decision Apron as a prop, the students explore the costs and benefits of decisions about lending. In a simulated lending ac...</p><br><p>--------------------------------------------------------------------</p><p><a href="event:function=viewLesson,68208"><b>Theme 4: Lesson 12 - We Are Borrowers</b></a><br><a href="event:function=viewPublication,131">Financial Fitness for Life: K-2 - Teacher Guide</a></p><br><p class="smaller_text">The students examine opportunities and responsibilities associated with borrowing. They experience an opportunity to borrow time for an extended activity and repay the borrowed time the next day. They analyze the borrowing decisions of Penny, Nich...</p><br><p>--------------------------------------------------------------------</p><p><a href="event:function=viewLesson,68176"><b>Theme 4: Lesson 13 - Buddy, Can You Spare a Dime?</b></a><br><a href="event:function=viewPublication,134">Financial Fitness for Life: Grades 3-5 - Teacher Guide</a></p><br><p class="smaller_text">The students decide how they would respond to various lending situations. In assessing these situations, they learn about what to consider in decisions about lending and borrowing. They analyze, from a lender's point of view, what qualities or cap...</p><br><p>--------------------------------------------------------------------</p><p><a href="event:function=viewLesson,68175"><b>Theme 4: Lesson 12 - Credit Is Based on Trust</b></a><br><a href="event:function=viewPublication,134">Financial Fitness for Life: Grades 3-5 - Teacher Guide</a></p><br><p class="smaller_text">The students solve a puzzle to learn about trustworthiness. They participate in a readers' theater activity and analyze the connection between trust and creditworthiness.</p><br><p>--------------------------------------------------------------------</p><p><a href="event:function=viewLesson,68171"><b>Theme 3: Lesson 8 - How Would You Like to Pay?</b></a><br><a href="event:function=viewPublication,134">Financial Fitness for Life: Grades 3-5 - Teacher Guide</a></p><br><p class="smaller_text">The students are introduced to various methods of payment, such as cash, check, debit and credit cards, and electronic or online payments. They learn about the advantages and disadvantages of each method of payment. They also practice writing a ch...</p><br><p>--------------------------------------------------------------------</p><p><a href="event:function=viewLesson,67123"><b>Lesson 11: Plenty of Pennies</b></a><br><a href="event:function=viewPublication,102">Mathematics & Economics: Connections for Life - 3-5</a></p><br><p class="smaller_text">This lesson focuses on interest (economics) and percents (mathematics). The students use pennies to help them compute percents. They convert percent to decimals and figure interest amounts on savings or borrowed money. They role-play to understand...</p><br><p>--------------------------------------------------------------------</p><p><a href="event:function=viewLesson,61984"><b>Lesson 3: What Happens When a Bank Makes a Loan?</b></a><br><a href="event:function=viewPublication,101">Learning, Earning and Investing: Grades 4-5 Lessons</a></p><br><p class="smaller_text">The students play roles in a simulation activity designed to show how bank loans made to individuals can have an impact on others in the community. Then, working in small groups, the students analyze other hypothetical loans, using flow charts or ...</p><br><p>--------------------------------------------------------------------</p><p><a href="event:function=viewLesson,20958"><b>Lesson 25: Obtaining a Bank Loan</b></a><br><a href="event:function=viewPublication,15">Exploring the Marketplace: The Community Publishing Company - Teacher Resource Manual</a></p><br><p class="smaller_text">This and the following lesson are designed to familiarize students with that process of obtaining a loan from a bank. You may choose either to invite a banker to visit the classroom or take a study trip to a bank to obtain a loan. Either of thes...</p><br> <p>--------------------------------------------------------------------</p><p><a href="event:function=viewLesson,591"><b><font color="#CC6666">Online Lesson:</font> You Can BANK on This! (Part 4)</b></a><br><a href='http://www.econedlink.org/' target='_blank'>EconEdLink.org</a></p><br><p class="smaller_text">This lesson deals with credit and wraps up this unit on finance.</p><br><p>--------------------------------------------------------------------</p><p><a href="event:function=viewLesson,481"><b><font color="#CC6666">Online Lesson:</font> Giving Credit</b></a><br><a href='http://www.econedlink.org/' target='_blank'>EconEdLink.org</a></p><br><p class="smaller_text">This lesson introduces the role and importance of the 3 C’s -- capacity, character, and collateral – to being granted credit. An online story about a girl who fails to return soccer shin guards borrowed from a friend is used to spark d...</p><br>]]></lessons>
<tips><![CDATA[<p class="tipHeading">Tip #1</p><p>Students often think that credit cards are money, and they don't recognize that there is a responsibility associated with credit. On a particularly beautiful day, allow your students to borrow 10 minutes of class time for additional free time. Explain that they will have to repay you later and that you will charge interest. On another particularly beautiful day, explain that the students will have to repay the time that they borrowed plus one minute. Reduce their free time by 11 minutes. They will complain, but remind them that credit involves borrowing something with the promise to repay. Discuss other things that they and other people borrow. Point out that when we borrow, we get something now, but we give up something in the future. Identify the extra minute as interest and explain that when people borrow money, they pay interest. Interest is the price paid for using someone else's money. Ask the students to analyze the costs and benefits of borrowing free time.</p><br><p class="tipHeading">Tip #2</p><p>Credit can be an effective tool for purchasing goods and services that are needed or desired. When talking about credit, it is easy to only cite examples of the pitfalls of buying goods and services using credit. Make sure that the students understand the positive aspects of establishing a good credit history. The ability to present a positive credit record is important to those seeking to borrow for business and personal needs in the future.</p><br><p class="tipHeading">Tip #3</p><p>Like all of us, students have unlimited wants, and using credit seems like an easy way to fulfill more of them. How should students distinguish between good and poor uses of credit? One useful rule is to not finance anything for longer than its useful life. Borrowing for housing, automobiles and education makes more sense than borrowing for entertainment or the latest consumer products. Even borrowing to buy a car may not make sense if the loan is for a longer period than you expect to own the car.</p><br><p class="tipHeading">Tip #4</p><p>Encourage your students to compare loans on the basis of the annual percentage rate (APR) and finance charge. Under the federal Truth in Lending Act, lenders must disclose these figures. Many people compare loans on the basis of the monthly payment. The monthly payment becomes lower if the repayment period is longer. Unfortunately, this also increases the finance charge. Avoid this confusion by determining the principal and repayment period first and then shop for the lowest APR.</p><br><p class="tipHeading">Tip #5</p><p>When lenders are trying to determine whether a prospective borrower has "good credit" or "bad credit," they often look to what is commonly known as the "Three C's of Credit"--character, capacity and collateral. If all three C's are positive, that individual represents less of a credit risk to the lender and thus is more likely to receive credit.</p><br><p class="tipHeading">Tip #6</p><p>Lenders and a growing list of others, such as employers, landlords and insurance providers, use a credit-scoring system to judge whether a prospective borrower, employee or renter is financially responsible. This credit score is called a FICO score. Credit scores are becoming a proxy for measuring character. Credit scores are based on information in credit reports. High credit scores are the result of keeping credit card balances low, paying bills on time and having steady employment. Low scores are associated with carrying high credit card balances, defaulting on payments and floating from job to job.</p><br>]]></tips>
<resources><![CDATA[<p><b>Interactive tools:</b><br /></p><p><font color="#CC6666">Flash</font> <a href='http://www.econedlink.org/i106' target='_blank'>Gen i Revolution - Mission 5: Credit</a></p><p>This interactive tool is a part of the online personal finance game, Gen i Revolution. This is one of the fifteen "Missions" available within the online game. This Mission takes about 30 minutes to complete. To sign up to play the game, you'll nee...<br><font size="-10"><br /></font><font size="-3">Date Published: 08/14/2010<br>Grades: 6-8, 9-12<br />Source: <a href='http://www.econedlink.org/' target='_blank'>EconEdLink.org</a></font></p><br><p><font color="#CC6666">Video</font> <a href='http://www.econedlink.org/i255' target='_blank'>Making Sen$e with Paul Solman: The State Of Student Loans: More Debt, More Defaults, More Problems</a></p><p>Americans owe $1 trillion in student loan debt. How did that happen, and what's the impact on the nation's economy? Economics correspondent Paul Solman reports as part of his Making Sen$e of financial news series.<br><font size="-10"><br /></font><font size="-3">Date Published: 05/30/2012<br>Grades: 9-12<br />Source: <a href='http://www.econedlink.org/' target='_blank'>EconEdLink.org</a></font></p><br><p><font color="#CC6666">Video</font> <a href='http://www.econedlink.org/i268' target='_blank'>Making Sen$e with Paul Solman: No Laughing Matter: A Look at the European Debt Crisis Through Cartoons</a></p><p>Lee Buchheit, a lawyer who helped mastermind Greece's debt restructuring earlier this year, and investor Hans Humes explain the wrangling behind-the-scenes of Europe's debt crises to economics correspondent Paul Solman, all with a little help from...<br><font size="-10"><br /></font><font size="-3">Date Published: 11/22/2012<br>Grades: 9-12<br />Source: <a href='http://www.econedlink.org/' target='_blank'>EconEdLink.org</a></font></p><br><p><font color="#CC6666">Video</font> <a href='http://www.econedlink.org/i256' target='_blank'>Making Sen$e with Paul Solman: Student Loan Debt: To Pay or Not to Pay?</a></p><p>In his second report this week on student lending, economics correspondent Paul Solman examines the challenges that indebted college graduates face and the debate over whether to forgive some or all of their loan burden.<br><font size="-10"><br /></font><font size="-3">Date Published: 05/31/2012<br>Grades: 9-12<br />Source: <a href='http://www.econedlink.org/' target='_blank'>EconEdLink.org</a></font></p><br><p><font color="#CC6666">Flash</font> <a href='http://www.econedlink.org/i143' target='_blank'>Developing Good Credit Habits</a></p><p>In this module, students will discover the secrets to developing good credit habits and learn how long it can take to pay off a credit card balance.
The objectives are to pay off credit card debt, maintain a good credit rating by making payments ...<br><font size="-10"><br /></font><font size="-3">Date Published: 02/16/2011<br>Grades: 6-8, 9-12<br />Source: <a href='http://www.econedlink.org/' target='_blank'>EconEdLink.org</a></font></p><br><p>-------------------------------------</p><p><b>Lessons:</b></p><br><p><a href='http://www.econedlink.org/e1022' target='_blank'>Loan Amortization - Mortgage</a></p><p>How to amortize a loan using an Excel spreadsheet.<br><font size="-10"><br /></font><font size="-3">Date Published: 11/10/2011<br />Grades: 9-12<br />Source: <a href='http://www.econedlink.org/' target='_blank'>EconEdLink.org</a></font></p><br><p><a href='http://www.econedlink.org/e1100' target='_blank'>Pop Goes the Housing Bubble</a></p><p>In this lesson, students will learn about a speculative bubble within the context of the U.S. real estate market.<br><font size="-10"><br /></font><font size="-3">Date Published: 03/11/2013<br />Grades: 9-12<br />Source: <a href='http://www.econedlink.org/' target='_blank'>EconEdLink.org</a></font></p><br><p><a href='http://www.econedlink.org/e1008' target='_blank'>Calculating Simple Interest</a></p><p>How do banks calculate the amount of interest paid on a loan? In this lesson, students will view a Livescribe Pencast to learn how to find the dollar amount in interest that is due at maturity. This lesson uses different time periods such as days, months, and years in the calculation as well as varying interest rates.<br><font size="-10"><br /></font><font size="-3">Date Published: 10/20/2011<br />Grades: 6-8, 9-12<br />Source: <a href='http://www.econedlink.org/' target='_blank'>EconEdLink.org</a></font></p><br><p><a href='http://www.econedlink.org/e847' target='_blank'>The Credit Card Mystery</a></p><p>Credit Cards are a risky business these days, especially for students and those holding multiple cards. Interest rates on credit card balances have always been high relative to other rates, for several reasons. Despite this, there is still a demand for the "plastic money" that many people see as convenient and ideal with the increasingly technological world economy. This lesson explores many issues surrounding credit cards- from what to look for when selecting a card to what the government is doing to aid consumers.<br><font size="-10"><br /></font><font size="-3">Date Published: 11/20/2009<br />Grades: 9-12<br />Source: <a href='http://www.econedlink.org/' target='_blank'>EconEdLink.org</a></font></p><br><p><a href='http://www.econedlink.org/e515' target='_blank'>Climbing the Savings Mountain</a></p><p>Students discover how saving money can be compared to a mountain climb. The climb can be fast or slow, safe or hazardous, scenic or thrilling. You will find out that there is more than one way to get to the top!<br><font size="-10"><br /></font><font size="-3">Date Published: 12/17/2003<br />Grades: 6-8<br />Source: <a href='http://www.econedlink.org/' target='_blank'>EconEdLink.org</a></font></p><br>]]></resources>
<related>
<concept>48</concept>
<concept>43</concept>
</related>
<quiz>1</quiz>
</concept>
<concept>
<id>1</id>
<name>Decision Making/Cost-Benefit Analysis</name>
<category>0</category>
<definition><![CDATA[<p><b>Decision making </b>refers to the process by which rational <a href="event:function=defineGlossaryTerm,Consumers">consumers</a> seeking their own happiness or <a href="event:function=defineGlossaryTerm,Utility">utility</a> will make choices. The process begins by defining the range of options that are possible. The next steps are to evaluate the <a href="event:function=defineGlossaryTerm,Costs">costs</a>, <a href="event:function=defineGlossaryTerm,Benefit">benefits</a> and <a href="event:function=defineGlossaryTerm,Trade-off">trade-offs</a> involved in each <a href="event:function=defineGlossaryTerm,Choice">choice</a> and to reach a decision. Since people have different preferences and face different life situations, there is no expectation that all people will make the same ultimate decision. Not even economists believe that people always follow this <a href="event:function=defineGlossaryTerm,Decision Making">decision-making</a> process carefully since decision making is costly. But economists do believe that, at least implicitly, people do consider their options and trade-offs and try to make the choice that brings them the greatest satisfaction.</p> <br><p><b>Cost-benefit analysis </b>is a technique for deciding whether an action should be taken by comparing its benefits and costs. It can be applied by individuals, <a href="event:function=defineGlossaryTerm,Firms">firms</a> or governments. However, difficulties often arise when cost-benefit analysis is used by individuals and government; for example, it can be difficult for a government agency to compare anticipated costs and benefits. If a cost of $100 million means that the view over the Grand Canyon is improved by 20 percent, how can an unbiased analyst decide if the benefit exceeds the cost? Thus, cost-benefit analysis often ends up using somewhat controversial <a href="event:function=defineGlossaryTerm,Assumptions">assumptions</a> to put monetary values on lives saved, days of sickness avoided, wildlife habitat protected and so on. Nevertheless, cost-benefit analysis provides a useful way of summarizing a great deal of information and organizing decision making. </p> <br><p>Economic decisions are always made on the basis of <a href="event:function=defineGlossaryTerm,Marginal Cost">marginal costs</a> and <a href="event:function=defineGlossaryTerm,Marginal Benefit">marginal benefits</a>. For example, the marginal cost of producing a good is the additional cost of producing one more unit of the good. Similarly, the marginal benefit of consuming a good is the additional value of <a href="event:function=defineGlossaryTerm,Consume">consuming</a> one more unit of it. Marginalism is critically important in understanding decision making because many of the decisions we make are marginal, as opposed to all-or-none decisions. For example, we don't make decisions between spending the entire day watching TV or the entire day studying. Instead, we choose between spending a little more time studying and a little less time watching TV, or vice versa. So a decision between studying and watching TV involves comparing the marginal benefit of studying with the marginal benefit of watching TV, not comparing their total benefit. The total benefit of studying could be far greater than the total benefit of watching TV, but after several hours of studying, the marginal benefit of studying could be less than the marginal benefit of watching TV.</p>]]></definition>
<lessons><![CDATA[<p>Below are <b>featured</b> lessons for teaching Decision Making/Cost-Benefit Analysis.</p><br><p class="tipHeading">High School Lessons</p><p>--------------------------------------------------------------------</p><p><a href="event:function=viewLesson,67732"><b>Lesson 6: Specialization and Trade in the Thirteen Colonies</b></a><br><a href="event:function=viewPublication,105">Focus: Understanding Economics in U.S. History</a></p><br><p class="smaller_text">The students examine information about resources and opportunities for specialization among the New England, Middle and Southern colonies. They use a five-step process to examine the costs and benefits arising from specialization in these regions....</p><br><p>--------------------------------------------------------------------</p><p><a href="event:function=viewLesson,67731"><b>Lesson 5: Indentured Servitude: Why Sell Yourself into Bondage?</b></a><br><a href="event:function=viewPublication,105">Focus: Understanding Economics in U.S. History</a></p><br><p class="smaller_text">Many workers in colonial North America were indentured servants -- people who signed contracts stating they would work for up to seven years in exchange for passage to North America, plus room and board in their new workplaces. In this lesson the ...</p><br><p>--------------------------------------------------------------------</p><p><a href="event:function=viewLesson,15423"><b>Lesson 2 - Economic Decision Making</b></a><br><a href="event:function=viewPublication,2">Economics in Action: 14 Greatest Hits for Teaching High School Economics</a></p><br><p class="smaller_text">Students brainstorm ways to allocate a scarce good within the classroom. Then they work with a decision-making model that helps them make a decision about this allocation by showing them how to evaluate the merits of each alternative. Finally, s...</p><br><p>--------------------------------------------------------------------</p><p><a href="event:function=viewLesson,20824"><b>Lesson 10: Powerball Economics</b></a><br><a href="event:function=viewPublication,11">Mathematics & Economics: Connections for Life - 9-12</a></p><br><p class="smaller_text">In games of chance, such as a lottery, economists refer to a fair game as one in which the expected return from the game equals the amount that one must pay to play the game. If a lottery costs one dollar to play and the expected return from the p...</p><br><p>--------------------------------------------------------------------</p><p><a href="event:function=viewLesson,62441"><b>Lesson 1 - Decision Making: Scarcity, Opportunity Cost, and You</b></a><br><a href="event:function=viewPublication,73">Personal Decision Making: Focus on Economics</a></p><br><p class="smaller_text">Students participate in a group activity that illustrates the concepts of scarcity, opportunity cost, trade-offs, and consequences.</p><br> <p>--------------------------------------------------------------------</p><p><a href="event:function=viewLesson,925"><b><font color="#CC6666">Online Lesson:</font> Utility</b></a><br><a href='http://www.econedlink.org/' target='_blank'>EconEdLink.org</a></p><br><p class="smaller_text">Can happiness be measured? Students will learn how utility relates to economic decision making and the law of diminishing marginal utility.</p><br><p>--------------------------------------------------------------------</p><p><a href="event:function=viewLesson,847"><b><font color="#CC6666">Online Lesson:</font> The Credit Card Mystery</b></a><br><a href='http://www.econedlink.org/' target='_blank'>EconEdLink.org</a></p><br><p class="smaller_text">Credit Cards are a risky business these days, especially for students and those holding multiple cards. Interest rates on credit card balances have always been high relative to other rates, for several reasons. Despite this, there is still a deman...</p><br><p>--------------------------------------------------------------------</p><p><a href="event:function=viewLesson,759"><b><font color="#CC6666">Online Lesson:</font> Marketplace: School Competition</b></a><br><a href='http://www.econedlink.org/' target='_blank'>EconEdLink.org</a></p><br><p class="smaller_text">In June 2002, the Supreme Court ruled that Cleveland's system of giving students vouchers to attend private or religious schools did not violate the constitutional separation of church and state. In this lesson, students listen to an audio file ab...</p><br><p>--------------------------------------------------------------------</p><p><a href="event:function=viewLesson,660"><b><font color="#CC6666">Online Lesson:</font> Education: Weigh Your Options</b></a><br><a href='http://www.econedlink.org/' target='_blank'>EconEdLink.org</a></p><br><p class="smaller_text">Getting and keeping a job often requires special education or training. While an employer may provide or pay for some additional education or training, workers often have to obtain it on their own. In this lesson, students use a weighted decision-...</p><br><p>--------------------------------------------------------------------</p><p><a href="event:function=viewLesson,326"><b><font color="#CC6666">Online Lesson:</font> Credit for Beginners</b></a><br><a href='http://www.econedlink.org/' target='_blank'>EconEdLink.org</a></p><br><p class="smaller_text">This lesson focuses on teaching students the basics about credit. It explains why credit is important, how to keep good credit and several of the terms that are associated with credit.</p><br><p class="tipHeading">Middle School Lessons</p><p>--------------------------------------------------------------------</p><p><a href="event:function=viewLesson,67915"><b>Unit 2: Trees and Forests</b></a><br><a href="event:function=viewPublication,107">Energy, Economics, and the Environment: Case Studies and Teaching Activities for Elementary School</a></p><br><p class="smaller_text">Trees and forests are a vital natural resource and affect our lives in innumerable ways. Therefore, it is very important that we learn how to manage our forest resource effectively. Fortunately, forest management in the United States has improved ...</p><br><p>--------------------------------------------------------------------</p><p><a href="event:function=viewLesson,65755"><b>Lesson 1 - The Problem of the Homeless Salmon</b></a><br><a href="event:function=viewPublication,95">Economics and the Environment: Ecodetectives</a></p><br><p class="smaller_text">This lesson introduces the principles of EcoDetection, a key element of EcoDetectives. By reference to the principles of EcoDetection, the lesson describes the problem of declining wild salmon populations and calls upon students to compare the lif...</p><br><p>--------------------------------------------------------------------</p><p><a href="event:function=viewLesson,60334"><b>Lesson 4 - Why Do People Move?</b></a><br><a href="event:function=viewPublication,53">Middle School World Geography: Focus on Economics</a></p><br><p class="smaller_text">In this lesson, the students learn that costs and benefits influence people's decisions about moving. The students review U.S. Census data to discuss possible reasons why people move. They analyze the costs and benefits of moving. They are introdu...</p><br><p>--------------------------------------------------------------------</p><p><a href="event:function=viewLesson,15852"><b>Lesson 7 - Which Pet is Right for You?</b></a><br><a href="event:function=viewPublication,3">Mathematics & Economics: Connections for Life - 6-8</a></p><br><p class="smaller_text">This lesson focuses on a topic that is at the heart of economics, that of decision making. Decision making from an economic perspective requires individuals to consider both the benefits and costs for each alternative. Human nature, however, often...</p><br> <p>--------------------------------------------------------------------</p><p><a href="event:function=viewLesson,789"><b><font color="#CC6666">Online Lesson:</font> You're Going to College</b></a><br><a href='http://www.econedlink.org/' target='_blank'>EconEdLink.org</a></p><br><p class="smaller_text">The students will explore the costs and the benefits of going to college. They participate in a three-part game designed to help them understand the decisions associated with attending college and the benefits available to college graduates.</p><br><p>--------------------------------------------------------------------</p><p><a href="event:function=viewLesson,746"><b><font color="#CC6666">Online Lesson:</font> Dumptown, USA: Making a Ton of Difference</b></a><br><a href='http://www.econedlink.org/' target='_blank'>EconEdLink.org</a></p><br><p class="smaller_text">The amount of trash produced in the United States is mounting with each passing year. Communities are finding it increasingly difficult and costly to handle trash disposal. Recycling is considered a key solution to the garbage problem. In this l...</p><br><p>--------------------------------------------------------------------</p><p><a href="event:function=viewLesson,308"><b><font color="#CC6666">Online Lesson:</font> There is Something in the Water</b></a><br><a href='http://www.econedlink.org/' target='_blank'>EconEdLink.org</a></p><br><p class="smaller_text">The United States is losing 60,000 acres of wetlands each year. Is this good or bad? Does anyone really want to live in swamps, fens, bogs, and marshes? Or is it better economics to drain the wetlands for other purposes like agricultural develop...</p><br><p>--------------------------------------------------------------------</p><p><a href="event:function=viewLesson,530"><b><font color="#CC6666">Online Lesson:</font> The Best Deal</b></a><br><a href='http://www.econedlink.org/' target='_blank'>EconEdLink.org</a></p><br><p class="smaller_text">Students will learn how to determine 'price per unit' to help make decisions when comparing products.</p><br><p>--------------------------------------------------------------------</p><p><a href="event:function=viewLesson,403"><b><font color="#CC6666">Online Lesson:</font> Bringing the Market to the Farm</b></a><br><a href='http://www.econedlink.org/' target='_blank'>EconEdLink.org</a></p><br><p class="smaller_text">Students learn how community supported agriculture (CSAs) is changing the relationship between the farmer and the consumer.</p><br><p>--------------------------------------------------------------------</p><p><a href="event:function=viewLesson,394"><b><font color="#CC6666">Online Lesson:</font> Fill 'er up, Please</b></a><br><a href='http://www.econedlink.org/' target='_blank'>EconEdLink.org</a></p><br><p class="smaller_text">Americans drive more than 2.6 trillion miles per year, that's 14,000 round trips to the sun! And for the most part, these vehicles are all running on gasoline. For many of us, we watch the price of gas as closely as the price of a gallon of m...</p><br><p class="tipHeading">Elementary Lessons</p><p>--------------------------------------------------------------------</p><p><a href="event:function=viewLesson,67925"><b>Lesson 4: Arthur's Pet Business</b></a><br><a href="event:function=viewPublication,116">Teaching Economics Using Children's Literature</a></p><br><p class="smaller_text">To prove he is responsible enough to own a pet and to repay a debt of money to his sister, Arthur decides to start a pet business - providing pet care service to community members. He advertises by putting up signs around the neighborhood. Busin...</p><br><p>--------------------------------------------------------------------</p><p><a href="event:function=viewLesson,67114"><b>Lesson 2: Choices, Choices</b></a><br><a href="event:function=viewPublication,102">Mathematics & Economics: Connections for Life - 3-5</a></p><br><p class="smaller_text">This lesson focuses on decision making (economics) and introduces surveying as a method of data collection (mathematics). After analyzing data on a sample topic, the students use a decision-making grid to help them rank career choices and create f...</p><br><p>--------------------------------------------------------------------</p><p><a href="event:function=viewLesson,62346"><b>Lesson 1: Choosing a House</b></a><br><a href="event:function=viewPublication,59">Master Curriculum Guides in Economics: Teaching Strategies - 5-6</a></p><br><p class="smaller_text">Economics is a decision-making science based on the concept of scarcity. Scarcity occurs when economic wants are greater than the resources available to satisfy them. Scarcity requires decision making, and economizing is the process of choosing ...</p><br><p>--------------------------------------------------------------------</p><p><a href="event:function=viewLesson,20981"><b>Unit 3: Lesson 15 - Scarcity Bulletin Board: Balloon Trip</b></a><br><a href="event:function=viewPublication,16">Master Curriculum Guides in Economics: Teaching Strategies - K-2</a></p><br><p class="smaller_text">Students take a make-believe balloon trip to places far away as they create a bulletin board display depicting scarcity and opportunity cost.</p><br><p>--------------------------------------------------------------------</p><p><a href="event:function=viewLesson,20980"><b>Unit 3: Lesson 14 - Learning Center: Choice Train</b></a><br><a href="event:function=viewPublication,16">Master Curriculum Guides in Economics: Teaching Strategies - K-2</a></p><br><p class="smaller_text">Students practice making choices and identifying their opportunity costs as they fill their wants from the Choice Train cars.</p><br> ]]></lessons>
<tips><![CDATA[<p class="tipHeading">Tip #1</p><p>Economic decisions are almost always made on the basis of marginal (extra) costs and benefits. Economics stresses the importance of making choices about the future because people cannot choose to change the past. You can drive this point home with simple examples. For example, you go to a movie and it is lousy. Should you stay? The decision should depend on the marginal costs and marginal benefits of staying, not on the fact that you paid for a ticket. After all, you paid for the ticket whether or not you stay. The cost of the ticket is sunk.</p><br><p class="tipHeading">Tip #2</p><p>Many CEE activities revolve around the "PACED Decision-Making Process." This is a five-step formula that people can use to help make decisions. The steps are: 1) define the <b>p</b>roblem, 2) list the <b>a</b>lternatives, 3) state the <b>c</b>riteria, 4) <b>e</b>valuate the alternatives and 5) make the <b>d</b>ecision. The PACED model works best with narrow problems such as selecting a college to attend or deciding which jacket to buy. It can also work for policy decisions such as a city council deciding whether to issue a permit for a new factory. Be sure to remind the students that the criteria rarely are of equal value. An alternative may rank high on most of the criteria and still be unacceptable because it rates poorly on one.</p><br><p class="tipHeading">Tip #3</p><p>For very young students, a decision tree or a decision apron is a helpful graphic organizer. These organizers limit the decision to two alternatives, and the students are able to identify the good and bad points about each alternative. For students in intermediate grades, a decision-making grid is a helpful graphic organizer. The students are able to list alternatives in the first column of the table and criteria in the first row. Using plus and minus signs, they can evaluate how well a particular alternative meets the specified criteria. When using the decision-making grid, it is important to state the criteria in a positive manner.</p><br><p class="tipHeading">Tip #4</p><p>Making a decision about whether or not to buy a pet, such as a dog, is a good way to introduce the notion of cost-benefit analysis. Using a simple T-chart as an organizer, the students can identify the costs and benefits of buying a dog. Costs refer to more than the purchase price of the dog. They would include time spent walking and caring for the dog and additional expenditures required to keep the dog. Benefits include the dog's companionship, fun of playing with the dog and exercise when walking the dog.</p><br>]]></tips>
<resources><![CDATA[<p><b>Interactive tools:</b><br /></p><p><font color="#CC6666">Video</font> <a href='http://www.econedlink.org/i184' target='_blank'>Decision Making/Cost-Benefit Analysis</a></p><p>This video teaches the concepts of Decision Making and Cost-Benefit Analysis. Decision making refers to the process by which rational consumers seeking their own happiness or utility will make choices. Cost-benefit analysis is a technique for deci...<br><font size="-10"><br /></font><font size="-3">Date Published: 07/12/2012<br>Grades: 3-5, 6-8, 9-12<br />Source: <a href='http://www.econedlink.org/' target='_blank'>EconEdLink.org</a></font></p><br><p><font color="#CC6666">Video</font> <a href='http://www.econedlink.org/i265' target='_blank'>Never Too Young: Personal Finance for Young Learners</a></p><p>This program was developed in response to a growing interest in teaching students about personal finance through settings outside of the traditional school day. The program teaches young students about financial choices, cost‐benefit analysis fo...<br><font size="-10"><br /></font><font size="-3">Date Published: 10/19/2012<br>Grades: K-2, 3-5<br />Source: <a href='http://www.econedlink.org/' target='_blank'>EconEdLink.org</a></font></p><br><p><font color="#CC6666">Video</font> <a href='http://www.econedlink.org/i190' target='_blank'>Opportunity Cost</a></p><p>This video teaches the concept of Opportunity Cost. Opportunity cost is what you must give up to obtain something else, the second-best alternative. However, what you must give up to obtain your first choice is not really money--it is whatever oth...<br><font size="-10"><br /></font><font size="-3">Date Published: 07/12/2012<br>Grades: 3-5, 6-8, 9-12<br />Source: <a href='http://www.econedlink.org/' target='_blank'>EconEdLink.org</a></font></p><br><p><font color="#CC6666">Flash</font> <a href='http://www.econedlink.org/i174' target='_blank'>You're Going to College</a></p><p>This game-based interactive gives students the chance to learn about costs and benefits, the cost of college, and potential lifetime earnings.<br><font size="-10"><br /></font><font size="-3">Date Published: 09/28/2011<br>Grades: 6-8, 9-12<br />Source: <a href='http://www.econedlink.org/' target='_blank'>EconEdLink.org</a></font></p><br><p><font color="#CC6666">Video</font> <a href='http://www.econedlink.org/i137' target='_blank'>The Economic Way of Thinking</a></p><p>This interactive tool contains two videos of Dr. Mark Schug explaining how the "economic way of thinking" can help students understand U.S. History concepts. If you're thinking about ways to improve your U.S. History course, these videos might hel...<br><font size="-10"><br /></font><font size="-3">Date Published: 02/16/2011<br>Grades: 6-8, 9-12<br />Source: <a href='http://www.econedlink.org/' target='_blank'>EconEdLink.org</a></font></p><br><p>-------------------------------------</p><p><b>Lessons:</b></p><br><p><a href='http://www.econedlink.org/e746' target='_blank'>Dumptown, USA: Making a Ton of Difference</a></p><p>The amount of trash produced in the United States is mounting with each passing year. Communities are finding it increasingly difficult and costly to handle trash disposal. Recycling is considered a key solution to the garbage problem. In this lesson, students explore the extent to which various types of solid waste contribute to the problem. They then assume the role of city managers who must choose recycling programs that will fit within a community's financial constraints. Students use marginal analysis to determine the most cost-effective solutions.<br><font size="-10"><br /></font><font size="-3">Date Published: 12/01/2008<br />Grades: 6-8<br />Source: <a href='http://www.econedlink.org/' target='_blank'>EconEdLink.org</a></font></p><br><p><a href='http://www.econedlink.org/e1057' target='_blank'>Opportunity Cost</a></p><p>Consumers are faced with tough choices because so many innovative and exciting products and services are available. Therefore, engraining a decision-making process that includes considering of opportunity cost is necessary to shape future consumer behavior.<br><font size="-10"><br /></font><font size="-3">Date Published: 01/03/2012<br />Grades: 9-12<br />Source: <a href='http://www.econedlink.org/' target='_blank'>EconEdLink.org</a></font></p><br><p><a href='http://www.econedlink.org/e789' target='_blank'>You're Going to College</a></p><p>The students will explore the costs and the benefits of going to college. They participate in a three-part game designed to help them understand the decisions associated with attending college and the benefits available to college graduates.<br><font size="-10"><br /></font><font size="-3">Date Published: 06/21/2009<br />Grades: 6-8<br />Source: <a href='http://www.econedlink.org/' target='_blank'>EconEdLink.org</a></font></p><br><p><a href='http://www.econedlink.org/e773' target='_blank'>Marketplace: Doing Business in Afghanistan</a></p><p>In May 2002, delegates from governments, international companies, and financial institutions met at a United Nations conference in Tehran to discuss the reconstruction of Afghanistan. Afghanistan's officials say that to create a viable economy and a stable society, the country must recreate basic infrastructures --and it requires foreign investment to do so. But will businesses want to invest in Afghanistan? Correspondent Borzou Daragahi recently traveled to Afghanistan's business centers to see what life is like for the foreign entrepreneur.<br><font size="-10"><br /></font><font size="-3">Date Published: 02/26/2009<br />Grades: 6-8, 9-12<br />Source: <a href='http://www.econedlink.org/' target='_blank'>EconEdLink.org</a></font></p><br><p><a href='http://www.econedlink.org/e584' target='_blank'>You Can BANK on This! (Part 2)</a></p><p>As in the first 'You Can BANK on This,' you will learn that banking should not be confusing - it should be INTERESTING! Lesson Two will continue learning with Zing, but this time we will learn all about budgeting - and budgeting means making choices!<br><font size="-10"><br /></font><font size="-3">Date Published: 06/20/2005<br />Grades: 3-5<br />Source: <a href='http://www.econedlink.org/' target='_blank'>EconEdLink.org</a></font></p><br>]]></resources>
<related>
<concept>4</concept>
<concept>10</concept>
<concept>57</concept>
<concept>8</concept>
</related>
<quiz>1</quiz>
</concept>
<concept>
<id>23</id>
<name>Demand</name>
<category>2</category>
<definition><![CDATA[<p><b>Demand</b> refers to a relationship between <a href="event:function=defineGlossaryTerm,Price">price</a> and the quantity of a <a href="event:function=defineGlossaryTerm,Goods">good</a> or <a href="event:function=defineGlossaryTerm,Services">service</a> that <a href="event:function=defineGlossaryTerm,Consumers">consumers</a> demand. A higher price for a good leads to a smaller <a href="event:function=defineGlossaryTerm,Quantity Demanded">quantity demanded</a>. <a href="event:function=defineGlossaryTerm,Demand">Demand</a> is typically illustrated as a downward-sloping curve on a graph with quantity on the horizontal axis and price on the vertical axis. </p> <br><p>A change in demand means that at every possible price, a different quantity will be demanded. For example, a rise in <a href="event:function=defineGlossaryTerm,Income">income</a> levels will increase the demand for <a href="event:function=defineGlossaryTerm,Normal Good">normal goods</a>, so that a greater quantity is demanded at every given price. A higher price for <a href="event:function=defineGlossaryTerm,Substitute Goods and Services">substitute goods</a> will cause demand for the original good to increase, while a lower price for substitute goods will cause demand for the original good to decrease. Demand for a good will increase if the good becomes more popular, but demand will decrease if the good becomes less popular. </p> <br><p>A change in demand is different from a change in quantity demanded. The quantity demanded is a specific amount at a particular price. A change in quantity demanded is caused by a change in the price of that good or service and is illustrated on a graph as a movement along the demand curve. However, demand is a relationship that shows the quantity demanded at each price. A change in the demand for a good or service is caused by something other than the price of that good or service. On a graph an increase in demand is illustrated by a shift to the right and a decrease in demand is illustrated by a shift to the left.</p>]]></definition>
<lessons><![CDATA[<p>Below are <b>featured</b> lessons for teaching Demand.</p><br><p class="tipHeading">High School Lessons</p><p>--------------------------------------------------------------------</p><p><a href="event:function=viewLesson,67748"><b>Lesson 22: The Demand for Immigrants</b></a><br><a href="event:function=viewPublication,105">Focus: Understanding Economics in U.S. History</a></p><br><p class="smaller_text">The students analyze information to solve a mystery about immigration. The teacher elaborates on their solution by using supply and
demand curves to illustrate the demand for and supply of labor in the United States from the end of the Civil War u...</p><br><p>--------------------------------------------------------------------</p><p><a href="event:function=viewLesson,60251"><b>Lesson 1: Markets and the Market System</b></a><br><a href="event:function=viewPublication,39">Focus: Institutions and Markets</a></p><br><p class="smaller_text">This lesson introduces students to the primary economic institution in a market economy, markets. As described in the introductory essay to this volume, markets are an institution that emerges spontaneously from the interaction of self-interested...</p><br><p>--------------------------------------------------------------------</p><p><a href="event:function=viewLesson,20815"><b>Lesson 1: The Nature of Demand</b></a><br><a href="event:function=viewPublication,11">Mathematics & Economics: Connections for Life - 9-12</a></p><br><p class="smaller_text">This lesson develops the economic tool of demand. Demand is determined by the value that people attach to a product (a good or a service). A demand curve is a graph with a negative slope that lies in the first quadrant. It illustrates the inverse ...</p><br> <p>--------------------------------------------------------------------</p><p><a href="event:function=viewLesson,925"><b><font color="#CC6666">Online Lesson:</font> Utility</b></a><br><a href='http://www.econedlink.org/' target='_blank'>EconEdLink.org</a></p><br><p class="smaller_text">Can happiness be measured? Students will learn how utility relates to economic decision making and the law of diminishing marginal utility.</p><br><p>--------------------------------------------------------------------</p><p><a href="event:function=viewLesson,758"><b><font color="#CC6666">Online Lesson:</font> Marketplace: Iraq's Supply and Demand</b></a><br><a href='http://www.econedlink.org/' target='_blank'>EconEdLink.org</a></p><br><p class="smaller_text">In this lesson, students listen to an audio file about how the growing demand for workers in Iraq in May 2004 affected the job market, and how the effects of low growth in the supply of workers shaped companies' hiring practices and influenced Ira...</p><br><p>--------------------------------------------------------------------</p><p><a href="event:function=viewLesson,651"><b><font color="#CC6666">Online Lesson:</font> China - Where will they fit in the world economy?</b></a><br><a href='http://www.econedlink.org/' target='_blank'>EconEdLink.org</a></p><br><p class="smaller_text">With its, emerging middle class, its new markets, and a new emphasis on increasing its technology base, where is China going to fit in the world economy?</p><br><p>--------------------------------------------------------------------</p><p><a href="event:function=viewLesson,458"><b><font color="#CC6666">Online Lesson:</font> What Do People Want to Wear?</b></a><br><a href='http://www.econedlink.org/' target='_blank'>EconEdLink.org</a></p><br><p class="smaller_text">To stay in business, fashion merchandisers must be able to anticipate what consumers want. By looking at different retail websites, students will look to anticipate what consumers are demanding. Students will then go through the market scen...</p><br><p class="tipHeading">Middle School Lessons</p><p>--------------------------------------------------------------------</p><p><a href="event:function=viewLesson,67880"><b>Lesson 11 - How Many Snacks Will the Students Buy?</b></a><br><a href="event:function=viewPublication,115">Focus: Economics - Grades 3-5</a></p><br><p class="smaller_text">In this lesson, the students role-play as consumers with a fixed amount to spend. They react to changes in price for a favorite snack food. The students use the data from this activity to describe the relationship between price and quantity dema...</p><br><p>--------------------------------------------------------------------</p><p><a href="event:function=viewLesson,15856"><b>Lesson 11 - Where Does the Price of Pizza Come From? Part 2</b></a><br><a href="event:function=viewPublication,3">Mathematics & Economics: Connections for Life - 6-8</a></p><br><p class="smaller_text">In this lesson students continue to examine where prices come from (see Lesson 10), applying the concepts of supply, demand, and equilibrium. Students will examine changes within a market for pizza utilizing linear equations as the vehicle for exa...</p><br><p>--------------------------------------------------------------------</p><p><a href="event:function=viewLesson,15855"><b>Lesson 10 - Where Does the Price of Pizza Come From? Part 1</b></a><br><a href="event:function=viewPublication,3">Mathematics & Economics: Connections for Life - 6-8</a></p><br><p class="smaller_text">This lesson challenges students to identify the source of market prices. The students will complete a series of activities that represent supply and demand. In Activity 10.1, the students are asked to plot points, connect the points through a stra...</p><br><p>--------------------------------------------------------------------</p><p><a href="event:function=viewLesson,62635"><b>Lesson 5 - Demand Shifters</b></a><br><a href="event:function=viewPublication,49">Focus: Middle School Economics</a></p><br><p class="smaller_text">This lesson gives students the opportunity to study the nonprice determinants of demand and their effect on the demand for products.</p><br><p>--------------------------------------------------------------------</p><p><a href="event:function=viewLesson,62634"><b>Lesson 4 - How Many Will You Buy?</b></a><br><a href="event:function=viewPublication,49">Focus: Middle School Economics</a></p><br><p class="smaller_text">In this lesson students participate in an activity to establish a demand schedule for a product. They discuss the relationship between price and quantity, graph demand, and conduct a market survey.</p><br> <p>--------------------------------------------------------------------</p><p><a href="event:function=viewLesson,853"><b><font color="#CC6666">Online Lesson:</font> The Ice Cream Stand</b></a><br><a href='http://www.econedlink.org/' target='_blank'>EconEdLink.org</a></p><br><p class="smaller_text">Students will learn about supply, demand, price, competition, and entrepreneurial skills in this lesson. They will put what they learned into action by creating an ice cream stand, to complete with other stands in the classroom.</p><br><p>--------------------------------------------------------------------</p><p><a href="event:function=viewLesson,747"><b><font color="#CC6666">Online Lesson:</font> The Prices Are Changing</b></a><br><a href='http://www.econedlink.org/' target='_blank'>EconEdLink.org</a></p><br><p class="smaller_text">This lesson will help students to understand how markets are created by the interaction of buyers and sellers, what demand and supply are, what equilibrium price is, and how demand and supply interact with price changes.</p><br><p>--------------------------------------------------------------------</p><p><a href="event:function=viewLesson,550"><b><font color="#CC6666">Online Lesson:</font> Demand Shifters</b></a><br><a href='http://www.econedlink.org/' target='_blank'>EconEdLink.org</a></p><br><p class="smaller_text">In this lesson students learn about demand and factors that cause demand for a good or service to change. They also learn to recognize factors that influence their behavior as a consumers.</p><br><p>--------------------------------------------------------------------</p><p><a href="event:function=viewLesson,369"><b><font color="#CC6666">Online Lesson:</font> Lemon Squeeze - The Lemonade Stand</b></a><br><a href='http://www.econedlink.org/' target='_blank'>EconEdLink.org</a></p><br><p class="smaller_text">Everyone has at one time or another opened a lemonade or Kool-Aid Stand. What a great place to begin an economics lesson. Students can taste test three brands of lemonade and compare prices with taste – is the most expensive the best? U...</p><br><p class="tipHeading">Elementary Lessons</p><p>--------------------------------------------------------------------</p><p><a href="event:function=viewLesson,68173"><b>Theme 3: Lesson 10 - Why Do I Want All This Stuff?</b></a><br><a href="event:function=viewPublication,134">Financial Fitness for Life: Grades 3-5 - Teacher Guide</a></p><br><p class="smaller_text">The students learn about types of advertising appeals, such as bandwagon, celebrity endorsement, and authority endorsement. They analyze ads to identify target audiences, the types of appeal used, and the facts and opinions included in the ads. Th...</p><br><p>--------------------------------------------------------------------</p><p><a href="event:function=viewLesson,67936"><b>Lesson 15: The Babe and I</b></a><br><a href="event:function=viewPublication,116">Teaching Economics Using Children's Literature</a></p><br><p class="smaller_text">The story is about a young boy growing up in New York during the Great Depression. He learns that his father is selling apples to support the family. The boy decides to help support the family by becoming a "newsie" - a street corner newspaper boy...</p><br><p>--------------------------------------------------------------------</p><p><a href="event:function=viewLesson,67120"><b>Lesson 8: Doughnut Dreaming</b></a><br><a href="event:function=viewPublication,102">Mathematics & Economics: Connections for Life - 3-5</a></p><br><p class="smaller_text">This lesson focuses on demand (economics) and line graphs (mathematics). The students use a class survey to collect data about the quantity demanded of doughnuts at different prices. They use this data to construct a line graph. They discuss the l...</p><br><p>--------------------------------------------------------------------</p><p><a href="event:function=viewLesson,62351"><b>Lesson 6: Demand Changes</b></a><br><a href="event:function=viewPublication,59">Master Curriculum Guides in Economics: Teaching Strategies - 5-6</a></p><br><p class="smaller_text">Price is an important factor influencing consumer purchases of goods and services. There are, however, other important determinants of demand. In constructing the demand schedule or curve, these determinants are assumed to be unchanging. Once d...</p><br><p>--------------------------------------------------------------------</p><p><a href="event:function=viewLesson,62350"><b>Lesson 5: Graphing Demand</b></a><br><a href="event:function=viewPublication,59">Master Curriculum Guides in Economics: Teaching Strategies - 5-6</a></p><br><p class="smaller_text">The concept of demand is sometimes easier to grasp when looking at a picture. A demand curve is a picture of the information in a demand schedule. When drawing a demand curve, price is traditionally placed on the vertical axis and quantity deman...</p><br><p>--------------------------------------------------------------------</p><p><a href="event:function=viewLesson,62349"><b>Lesson 4: A Profusion of Confusion</b></a><br><a href="event:function=viewPublication,59">Master Curriculum Guides in Economics: Teaching Strategies - 5-6</a></p><br><p class="smaller_text">There are many misconceptions about the meaning of the term "demand" in everyday life. Demand is a set of possible prices at which consumers are willing and able to purchase a product. The demand schedule indicates the amount consumers will buy ...</p><br> <p>--------------------------------------------------------------------</p><p><a href="event:function=viewLesson,557"><b><font color="#CC6666">Online Lesson:</font> Those Golden Jeans</b></a><br><a href='http://www.econedlink.org/' target='_blank'>EconEdLink.org</a></p><br><p class="smaller_text">This lesson is designed to review the three types of productive resources-natural resources, human resources, and capital resources-needed to produce goods and services. Students use the internet to identify examples of each - first in the pr...</p><br><p>--------------------------------------------------------------------</p><p><a href="event:function=viewLesson,209"><b><font color="#CC6666">Online Lesson:</font> If I Ran the Zoo - Economics and Literature</b></a><br><a href='http://www.econedlink.org/' target='_blank'>EconEdLink.org</a></p><br><p class="smaller_text">Welcome to the Zoo! In this two-day lesson you will use Dr. Seuss' If I Ran The Zoo book to introduce the economic concepts to your students. You will also get the chance to use actual zoo criteria to help a zoo "choose" new animals.</p><br><p>--------------------------------------------------------------------</p><p><a href="event:function=viewLesson,357"><b><font color="#CC6666">Online Lesson:</font> To Market To Market</b></a><br><a href='http://www.econedlink.org/' target='_blank'>EconEdLink.org</a></p><br><p class="smaller_text">This lesson will help students become good consumers and producers by taking turns buying and selling things in a classroom-created market. Students will establish prices for items and observe what happens during the sale of those items.</p><br>]]></lessons>
<tips><![CDATA[<p class="tipHeading">Tip #1</p><p>Younger students often view demand simply as what consumers want. In economics, the term "demand" refers to two sub-concepts: quantity and price. Demand is the quantity consumers are willing and able to buy at different prices. The law of demand states that when prices increase, people buy less, and when prices decrease, people buy more. Many reports in the media--even in the business pages of the newspaper--fail to use the term correctly. Ask the students to read a newspaper or to check other media for errors in using the term "demand."</p><br><p class="tipHeading">Tip #2</p><p>Students often see a demand curve as a graph in itself and not a graph that represents the behavior of buyers. Here is a brief activity that shows that buyers will buy more at lower prices. Tell the students you are going to sell an "A" on the next test. Each student will submit a sealed bid. After you receive the bids, develop a demand curve with them. Arrange the bids from the highest to the lowest. In developing the demand curve, point out that the bids are cumulative. That is, a person willing to pay $50 is also willing to pay $2. Develop the demand curve on the board, and ask the students to describe the behavior of consumers in relation to price and quantity demanded.</p><br><p class="tipHeading">Tip #3</p><p>Have the students consider demand as a prediction or a forecasting device which anticipates what consumers will do if one incentive (price) is changed and no other incentives are changed. As prices rise, the additional cost will encourage people to purchase less. As prices fall, the reduced cost will encourage people to purchase more.</p><br><p class="tipHeading">Tip #4</p><p>Students often confuse a change in demand with a change in the quantity demanded. A change in the quantity demanded indicates a movement along the curve; a change in demand indicates a shift of the curve. When there is a change in demand, the quantity demanded increases or decreases at each and every price. You might explain this by visualizing quantity demanded as a street. Only a change in price can move you up or down the street. A change in the determinants of demand, such as consumer income, consumer expectations, the number of buyers, consumer tastes and the prices of complementary goods, moves you to a different street. In other words, more or less is demanded at every price.</p><br><p class="tipHeading">Tip #5</p><p>Students will ask what difference does a change in the quantity demanded versus a change in demand make. It makes all the difference in the world. Only a decrease in prices can increase the quantity demanded. An increase in demand actually increases the price.</p><br>]]></tips>
<resources><![CDATA[<p><b>Interactive tools:</b><br /></p><p><font color="#CC6666">Video</font> <a href='http://www.econedlink.org/i150' target='_blank'>Making Sen$e with Paul Solman: GM, Detroit Pinning Hopes for Future on Chevy Volt</a></p><p>Paul Solman travels to Detroit for an update car and examines how GM and the city are hoping for a brighter economic future.<br><font size="-10"><br /></font><font size="-3">Date Published: 01/19/2011<br>Grades: 9-12<br />Source: <a href='http://www.econedlink.org/' target='_blank'>EconEdLink.org</a></font></p><br><p><font color="#CC6666">Video</font> <a href='http://www.econedlink.org/i48' target='_blank'>Making Sen$e with Paul Solman: Hints of a Meltdown in Commercial Real Estate</a></p><p>Is the commercial real estate market the next shoe to drop in the U.S. economy? Paul Solman reports.<br><font size="-10"><br /></font><font size="-3">Date Published: 10/06/2009<br>Grades: 9-12<br />Source: <a href='http://www.econedlink.org/' target='_blank'>EconEdLink.org</a></font></p><br><p><font color="#CC6666">Video</font> <a href='http://www.econedlink.org/i10' target='_blank'>Making Sen$e with Paul Solman: Global Trade Freezes Amid Economic Downturn</a></p><p>Economics correspondent Paul Solman reports on how the global economic crisis has impacted trade.<br><font size="-10"><br /></font><font size="-3">Date Published: 01/30/2009<br>Grades: 9-12<br />Source: <a href='http://www.econedlink.org/' target='_blank'>EconEdLink.org</a></font></p><br><p><font color="#CC6666">Video</font> <a href='http://www.econedlink.org/i209' target='_blank'>Consumers</a></p><p>This video teaches the concept of Consumers. Consumers are powerful in a market economy, and the economic choices of consumers in the marketplace drive the behavior of producers.
This video comes from Virtual Economics. To see all of the videos...<br><font size="-10"><br /></font><font size="-3">Date Published: 07/12/2012<br>Grades: K-2, 3-5, 6-8, 9-12<br />Source: <a href='http://www.econedlink.org/' target='_blank'>EconEdLink.org</a></font></p><br><p><font color="#CC6666">Video</font> <a href='http://www.econedlink.org/i210' target='_blank'>Demand</a></p><p>This video teaches the concept of Demand. Demand refers to a relationship between price and the quantity of a good or service that consumers demand.<br><font size="-10"><br /></font><font size="-3">Date Published: 07/12/2012<br>Grades: 3-5, 6-8, 9-12<br />Source: <a href='http://www.econedlink.org/' target='_blank'>EconEdLink.org</a></font></p><br><p>-------------------------------------</p><p><b>Lessons:</b></p><br><p><a href='http://www.econedlink.org/e692' target='_blank'>Henry Ford and the Model T: A Case Study in Productivity (Part 3)</a></p><p>When Henry Ford announced he was going to produce an automobile that would be affordable to the masses, it is doubtful even he realized the far reaching impact such an achievement would have on life in the U.S. and eventually, the world. Ford’s use of mass production strategies to manufacture the Model T revolutionized industrial manufacturing and initiated a new era in personal transportation. This 3-part learning unit provides students with the story of Henry Ford and the Model T from an economics perspective. Parts 1 and 2 explore how the Ford Motor Company successfully introduced mass production strategies to the auto industry. Students learn how specialization and investments in capital (machines, people, etc.) increased productivity and allowed Ford to slash the price of his popular vehicle. Students chart a plan for the assembly line production of bookmarks, test their plan and make recommendations for improvements. Students also explore how Henry Ford used economic incentives to address a problem created by mass production techniques—worker turnover. An optional Part 3 explains how increased productivity resulted in shifts in the supply and demand for the Model T. Students analyze how a variety of non price determinants continue to influence the automobile market today. A wealth of extension activities is provided if additional time is available.<br><font size="-10"><br /></font><font size="-3">Date Published: 01/15/2008<br />Grades: 6-8, 9-12<br />Source: <a href='http://www.econedlink.org/' target='_blank'>EconEdLink.org</a></font></p><br><p><a href='http://www.econedlink.org/e46' target='_blank'>I'll Trade You a Bag of Chips, Two Cookies, and $60,000 for Your Tuna Fish Sandwich</a></p><p>Okay, so your tuna fish sandwich probably isn't worth a couple grand. It's most likely made with a type of tuna called albacore. But, on the docks in Tokyo different kind of tuna, related to the stuff in your sandwich, is sold for $70,000 dollars a fish. The Japanese praise the bluefin tuna, or maguro, as a delicacy.<br><font size="-10"><br /></font><font size="-3">Date Published: 11/04/1999<br />Grades: 9-12<br />Source: <a href='http://www.econedlink.org/' target='_blank'>EconEdLink.org</a></font></p><br><p><a href='http://www.econedlink.org/e966' target='_blank'>Green Eggs and ...Economics?</a></p><p>Economic concepts are often found in places students have never considered, like children’s literature. In this lesson, students will explore the various economic concepts addressed in five of Dr. Seuss' most popular books: The Cat in the Hat; Green Eggs and Ham; The Lorax; Oh, the Places You’ll Go! and Horton Hears a Who! This lesson assumes the students already have some knowledge of basic microeconomic concepts. Therefore, it would be best utilized as a review or unit summary to reinforce the concepts you have already covered.<br><font size="-10"><br /></font><font size="-3">Date Published: 01/19/2012<br />Grades: 9-12<br />Source: <a href='http://www.econedlink.org/' target='_blank'>EconEdLink.org</a></font></p><br><p><a href='http://www.econedlink.org/e694' target='_blank'>What Happened to Railroads?</a></p><p>Between the Civil War and World War II, railroads were one of the nation's most important businesses and an integral part of people’s lives. In this lesson, students assume the role of detectives investigating why the rail companies experienced a crisis in the 1960s and what helped the freight transport portion of the business return to profitability later in the same century. Students analyze a set of clues that help them explore the impact of government policies and changes in consumer demand on rail service. They discover that government policies (e.g., regulations, subsidies, and taxes) can have both positive and negative consequences in the marketplace. An interactive activity helps students understand that rail service competes in two different markets—passenger service and hauling freight. Students also learn that railroads and government policies have had to adjust as the transportation industry changed in the second half of the twentieth century.<br><font size="-10"><br /></font><font size="-3">Date Published: 06/07/2007<br />Grades: 9-12<br />Source: <a href='http://www.econedlink.org/' target='_blank'>EconEdLink.org</a></font></p><br><p><a href='http://www.econedlink.org/e664' target='_blank'>The Price of Gasoline: What's Behind It?</a></p><p>In this lesson, students investigate the variables that contribute to the cost of gasoline. They learn that while OPEC nations do influence the price of oil and thus the price of gasoline, other factors also influence the price.<br><font size="-10"><br /></font><font size="-3">Date Published: 07/21/2006<br />Grades: 6-8<br />Source: <a href='http://www.econedlink.org/' target='_blank'>EconEdLink.org</a></font></p><br>]]></resources>
<related>
<concept>68</concept>
<concept>26</concept>
<concept>35</concept>
<concept>34</concept>
</related>
<quiz>1</quiz>
</concept>
<concept>
<id>56</id>
<name>Division of Labor/Specialization</name>
<category>0</category>
<definition><![CDATA[<p>The <b>division of labor</b> refers to the practice that the tasks of producing a <a href="event:function=defineGlossaryTerm,Goods">good </a>or <a href="event:function=defineGlossaryTerm,Services">service</a> are divided up into separate tasks. When <a href="event:function=defineGlossaryTerm,Workers">workers</a> focus on performing separate tasks, <b>specialization </b>occurs. Within a company, for example, there are typically workers who specialize in buying supplies, different aspects of production, future planning, paying bills and <a href="event:function=defineGlossaryTerm,Taxes">taxes</a>, collecting <a href="event:function=defineGlossaryTerm,Sales Revenue">sales revenue</a>, hiring and managing workers, and many other categories. Within the economy as a whole, the <a href="event:function=defineGlossaryTerm,Division of Labor">division of labor</a> explains why even if you bake your own bread, you typically don't grow your own wheat, grind it into flour, build your own oven, make your own bread-pans and so on. Instead, people specialize in a few skills and then take the <a href="event:function=defineGlossaryTerm,Wage">wages</a> that they earn from those skills to purchase the other goods and services that they desire from other specialists. In this way, the division of labor and <a href="event:function=defineGlossaryTerm,Specialization">specialization</a> is the basis for an economy to exist.</p> <br><p>Adam Smith started his classic book <i>The Wealth of Nations</i> with a discussion of the division of labor as the basis for understanding how an economy works. He identified three reasons why the division of labor increases output: workers who specialize on one <a href="event:function=defineGlossaryTerm,Job">job</a> become much better at doing it; with specialization, the time that it would take to switch between jobs is eliminated; and workers who specialize on one job often invent more effective ways or new machines for doing the job. But as Adam Smith makes clear, specialization is possible only when people are able to coordinate their <a href="event:function=defineGlossaryTerm,Production">production</a> and <a href="event:function=defineGlossaryTerm,Consumption">consumption</a> decisions with each other. The study of <a href="event:function=defineGlossaryTerm,Economics">economics</a> is largely concerned with explaining how this coordination takes place.</p>]]></definition>
<lessons><![CDATA[<p>Below are <b>featured</b> lessons for teaching Division of Labor/Specialization.</p><br><p class="tipHeading">High School Lessons</p><p>--------------------------------------------------------------------</p><p><a href="event:function=viewLesson,67730"><b>Lesson 4: Understanding the Colonial Economy in a Global Context</b></a><br><a href="event:function=viewPublication,105">Focus: Understanding Economics in U.S. History</a></p><br><p class="smaller_text">The students discuss a mystery regarding economic growth in the American colonies, making inferences from statistics about trade and population in their effort to explain why the colonies prospered. The lesson includes an application exercise in w...</p><br><p>--------------------------------------------------------------------</p><p><a href="event:function=viewLesson,60251"><b>Lesson 1: Markets and the Market System</b></a><br><a href="event:function=viewPublication,39">Focus: Institutions and Markets</a></p><br><p class="smaller_text">This lesson introduces students to the primary economic institution in a market economy, markets. As described in the introductory essay to this volume, markets are an institution that emerges spontaneously from the interaction of self-interested...</p><br><p>--------------------------------------------------------------------</p><p><a href="event:function=viewLesson,15429"><b>Lesson 8 - Productivity</b></a><br><a href="event:function=viewPublication,2">Economics in Action: 14 Greatest Hits for Teaching High School Economics</a></p><br><p class="smaller_text">Working in small groups, the students participate in a production simulation to determine the effects of specialization on labor productivity, the division of labor, and investment in human capital and capital goods.</p><br><p>--------------------------------------------------------------------</p><p><a href="event:function=viewLesson,15427"><b>Lesson 6 - The Economic Way of Thinking: Three Activities to Demonstrate Marginal Analysis</b></a><br><a href="event:function=viewPublication,2">Economics in Action: 14 Greatest Hits for Teaching High School Economics</a></p><br><p class="smaller_text">This lesson consists of three activities that demonstrate different applications of marginal analysis. You may use the activities separately or do them together in one class period. In the first activity, the students produce a good and demonstrat...</p><br><p>--------------------------------------------------------------------</p><p><a href="event:function=viewLesson,785"><b><font color="#CC6666">Online Lesson:</font> The Unemployment Game</b></a><br><a href='http://www.econedlink.org/' target='_blank'>EconEdLink.org</a></p><br><p class="smaller_text">Students will learn about important labor market statistics that are frequently discussed in the media. An understanding of the unemployment rate and labor force participation rate will be developed through participation in an interactive simulat...</p><br><p>--------------------------------------------------------------------</p><p><a href="event:function=viewLesson,719"><b><font color="#CC6666">Online Lesson:</font> Transportation: They Say We Had a Revolution (Part 1)</b></a><br><a href='http://www.econedlink.org/' target='_blank'>EconEdLink.org</a></p><br><p class="smaller_text">Advancements in transportation have played a key role in the growth of our nation. U.S.government policies have also had a considerable impact on the development of transport as we know it today. In this series of three lessons,the students examin...</p><br><p>--------------------------------------------------------------------</p><p><a href="event:function=viewLesson,668"><b><font color="#CC6666">Online Lesson:</font> Henry Ford and the Model T: A Case Study in Productivity (Part 1)</b></a><br><a href='http://www.econedlink.org/' target='_blank'>EconEdLink.org</a></p><br><p class="smaller_text">When Henry Ford announced he was going to produce an automobile that would be affordable to the masses, he probably did not realize what a great impact his achievement would have on life in the United States and, eventually, the world. Ford’...</p><br><p>--------------------------------------------------------------------</p><p><a href="event:function=viewLesson,350"><b><font color="#CC6666">Online Lesson:</font> Lemonade and Cookies</b></a><br><a href='http://www.econedlink.org/' target='_blank'>EconEdLink.org</a></p><br><p class="smaller_text">Everyday countries trade their goods because they have the comparative advantage in making that particular good. In this lesson, you will read through an interactive story problem to learn about trade and specialization and the outcomes they ...</p><br><p>--------------------------------------------------------------------</p><p><a href="event:function=viewLesson,75"><b><font color="#CC6666">Online Lesson:</font> Baseball Economics 101</b></a><br><a href='http://www.econedlink.org/' target='_blank'>EconEdLink.org</a></p><br><p class="smaller_text">As any baseball fan can tell you, the New York Yankees have won three of the last four World Series championships. The Yankees' recent success--as well as the success of other big market, high revenue teams--has led many to question whether s...</p><br><p class="tipHeading">Middle School Lessons</p><p>--------------------------------------------------------------------</p><p><a href="event:function=viewLesson,67876"><b>Lesson 7 - The Shape of Production</b></a><br><a href="event:function=viewPublication,115">Focus: Economics - Grades 3-5</a></p><br><p class="smaller_text">In this simulation, the students act as workers to produce two-dimensional shapes using toothpicks and marshmallows. Through the timed production process, the students learn that specialization of labor and specialization of production lead to in...</p><br><p>--------------------------------------------------------------------</p><p><a href="event:function=viewLesson,60336"><b>Lesson 6 - Joining Together That Which Has Drifted Apart</b></a><br><a href="event:function=viewPublication,53">Middle School World Geography: Focus on Economics</a></p><br><p class="smaller_text">In this lesson, the students learn about the physical forces that move people on different continents further apart and the economic forces that bring them together. They read about the formation and breakup of two great continents, Laurasia and G...</p><br><p>--------------------------------------------------------------------</p><p><a href="event:function=viewLesson,20769"><b>Lesson 7: Mutual (and Comparative) Advantages</b></a><br><a href="event:function=viewPublication,9">The Wide World of Trade</a></p><br><p class="smaller_text">Using numerical examples and bar graphs, students see why it benefits two countries to specialize in the production of one of two products and then trade with each other, even if one country has the resources and technology to produce more of eith...</p><br><p>--------------------------------------------------------------------</p><p><a href="event:function=viewLesson,20765"><b>Lesson 3: Everyone Is Interdependent</b></a><br><a href="event:function=viewPublication,9">The Wide World of Trade</a></p><br><p class="smaller_text">In this lesson, students learn about resources from around the world that are used in the production of a specific product -- Hershey's Kisses. Students then determine the identity of a mystery product using clues about world resources that are u...</p><br><p>--------------------------------------------------------------------</p><p><a href="event:function=viewLesson,62646"><b>Lesson 16 - Frontier Specialists</b></a><br><a href="event:function=viewPublication,49">Focus: Middle School Economics</a></p><br><p class="smaller_text">Using a simulation about frontier families, this lesson helps students gain a understanding of the benefits of specialization and how comparative advantage forms the basis for exchange in a market economy.</p><br> <p>--------------------------------------------------------------------</p><p><a href="event:function=viewLesson,702"><b><font color="#CC6666">Online Lesson:</font> Work, Earnings and Economics: Using 'Lyddie' by Katherine Paterson</b></a><br><a href='http://www.econedlink.org/' target='_blank'>EconEdLink.org</a></p><br><p class="smaller_text">To get started, the students will read Lyddie, a novel by Katherine Paterson. The novel is set mainly in Lowell, Massachusetts, in the 1840s. In Lowell the main character, 13-year-old Lyddie Worthen, works six days a week, from dawn until dusk, ...</p><br><p>--------------------------------------------------------------------</p><p><a href="event:function=viewLesson,664"><b><font color="#CC6666">Online Lesson:</font> The Price of Gasoline: What's Behind It?</b></a><br><a href='http://www.econedlink.org/' target='_blank'>EconEdLink.org</a></p><br><p class="smaller_text">In this lesson, students investigate the variables that contribute to the cost of gasoline. They learn that while OPEC nations do influence the price of oil and thus the price of gasoline, other factors also influence the price.</p><br><p>--------------------------------------------------------------------</p><p><a href="event:function=viewLesson,231"><b><font color="#CC6666">Online Lesson:</font> Human Capital For Money</b></a><br><a href='http://www.econedlink.org/' target='_blank'>EconEdLink.org</a></p><br><p class="smaller_text">The first part of this lesson introduces students to the terms human capital, occupation, salary, and wages. Part two of this lesson provides the students an opportunity to compare selected careers including median salary and education stat...</p><br><p class="tipHeading">Elementary Lessons</p><p>--------------------------------------------------------------------</p><p><a href="event:function=viewLesson,67927"><b>Lesson 6: The Goat in the Rug</b></a><br><a href="event:function=viewPublication,116">Teaching Economics Using Children's Literature</a></p><br><p class="smaller_text">Geraldine the goal literally puts her whole self into the weaving of a Navajo rug. After being sheared for her wool, she watches as Glenmae cleans, dries, combs, spins, and dyes her wool. Geraldine is so proud. A lot of her is in that rug. She...</p><br><p>--------------------------------------------------------------------</p><p><a href="event:function=viewLesson,67117"><b>Lesson 5: The Math Factory</b></a><br><a href="event:function=viewPublication,102">Mathematics & Economics: Connections for Life - 3-5</a></p><br><p class="smaller_text">This lesson focuses on productivity (economics) and multiplication (mathematics). The students learn about physical capital and human capital as they create multiplication-fact review cards. In the first production round, groups of students produc...</p><br><p>--------------------------------------------------------------------</p><p><a href="event:function=viewLesson,62352"><b>Lesson 7: Widget Production</b></a><br><a href="event:function=viewPublication,59">Master Curriculum Guides in Economics: Teaching Strategies - 5-6</a></p><br><p class="smaller_text">In order to produce an output of goods or services, a firm needs inputs or factors of production. Businesses must purchase natural, human, and capital resources. Entrepreneurship is provided by the owner or manager of the firm. These inputs can ...</p><br><p>--------------------------------------------------------------------</p><p><a href="event:function=viewLesson,20985"><b>Unit 4: Lesson 19 - Learning Center: School Connections</b></a><br><a href="event:function=viewPublication,16">Master Curriculum Guides in Economics: Teaching Strategies - K-2</a></p><br><p class="smaller_text">Students learn that the school has specialized workers upon whom they depend while they are at school.</p><br><p>--------------------------------------------------------------------</p><p><a href="event:function=viewLesson,20982"><b>Unit 4: Lesson 16 - An Interdependent Bunch</b></a><br><a href="event:function=viewPublication,16">Master Curriculum Guides in Economics: Teaching Strategies - K-2</a></p><br><p class="smaller_text">Students create a bunch of balloon grapes to illustrate the concept that they make a "great bunch" of interdependent workers.</p><br> <p>--------------------------------------------------------------------</p><p><a href="event:function=viewLesson,745"><b><font color="#CC6666">Online Lesson:</font> How Labor Got Its Day</b></a><br><a href='http://www.econedlink.org/' target='_blank'>EconEdLink.org</a></p><br><p class="smaller_text">If you asked students what comes to mind first when they think of Labor Day, what do you think they would say? The last days of summer? A family picnic? Shopping the Labor Day sales? The purpose of this lesson is to broaden and deepen student unde...</p><br><p>--------------------------------------------------------------------</p><p><a href="event:function=viewLesson,478"><b><font color="#CC6666">Online Lesson:</font> Hawaiian Economics: Barter for Fish & Poi</b></a><br><a href='http://www.econedlink.org/' target='_blank'>EconEdLink.org</a></p><br><p class="smaller_text">In ancient Hawaii, chiefs managed the economy by creating a land division system, the Ahupua'a, which divided the islands into pie slice shapes. Each Ahupua'a covered the three main regions of the islands: the mountains, the valleys, and the ...</p><br><p>--------------------------------------------------------------------</p><p><a href="event:function=viewLesson,279"><b><font color="#CC6666">Online Lesson:</font> I Can Dream Anything!</b></a><br><a href='http://www.econedlink.org/' target='_blank'>EconEdLink.org</a></p><br><p class="smaller_text">After listening to the song, 'I Can Do Anything', students discuss services that people in the community perform. This lesson will let students know that there are many careers out there and many choices to be made!</p><br><p>--------------------------------------------------------------------</p><p><a href="event:function=viewLesson,195"><b><font color="#CC6666">Online Lesson:</font> Dog Gone Job!</b></a><br><a href='http://www.econedlink.org/' target='_blank'>EconEdLink.org</a></p><br><p class="smaller_text">Dog Gone Job! demonstrates how job specialization increases productivity</p><br><p>--------------------------------------------------------------------</p><p><a href="event:function=viewLesson,64"><b><font color="#CC6666">Online Lesson:</font> Old Business, New Business</b></a><br><a href='http://www.econedlink.org/' target='_blank'>EconEdLink.org</a></p><br><p class="smaller_text">In this lesson students are introduced to several businesses from the past. They see that, while the names for these businesses are different, many of the elements of that job are seen in occupations today. The web site, "Business Card...</p><br>]]></lessons>
<tips><![CDATA[<p class="tipHeading">Tip #1</p><p>People can benefit from specialization, whether acting as individuals, groups or nations. Not only is specialization the cause of domestic efficiency, it is the basis for international trade as well. Much the same as you specialize in what you are most skilled, teaching, for example, nations may also specialize in the production of particular goods and services. When they specialize and trade with other nations, citizens of both countries are able to consume more goods and services than they would otherwise.</p><br><p class="tipHeading">Tip #2</p><p>As the students study their communities, they begin to recognize the idea that they and their families don't produce all of the things that they consume. The students can recognize that because of specialization people are interdependent, and they can create an interdependence web for their school or their community by answering the question: On whom do we depend each day?</p><br><p class="tipHeading">Tip #3</p><p>Why do the division of labor and specialization increase the quantity and quality of goods and services? Adam Smith wrote about this in his 1776 classic, <i>The Wealth of Nations</i>: "This great increase in the quantity of work, which, in consequence of the division of labour, the same number of people are capable of performing, is owing to three different circumstances: first, to the increase of dexterity in every particular workman; secondly, to the saving of the time which is commonly lost in passing from one species of work to another; and lastly, to the invention of a great number of machines which facilitate and abridge labour, and enable one man to do the work of many."</p><br>]]></tips>
<resources><![CDATA[<p><b>Interactive tools:</b><br /></p><p><font color="#CC6666">Video</font> <a href='http://www.econedlink.org/i192' target='_blank'>Productivity</a></p><p>This video teaches the concept of Productivity, which is measured as the quantity of output per unit of input.<br><font size="-10"><br /></font><font size="-3">Date Published: 07/12/2012<br>Grades: 6-8, 9-12<br />Source: <a href='http://www.econedlink.org/' target='_blank'>EconEdLink.org</a></font></p><br><p><font color="#CC6666">Video</font> <a href='http://www.econedlink.org/i185' target='_blank'>Division of Labor/Specialization</a></p><p>This video teaches the concepts of Division of Labor and Specialization. The division of labor refers to the practice that the tasks of producing a good or service are divided up into separate tasks. When workers focus on performing separate tasks...<br><font size="-10"><br /></font><font size="-3">Date Published: 07/12/2012<br>Grades: 6-8, 9-12<br />Source: <a href='http://www.econedlink.org/' target='_blank'>EconEdLink.org</a></font></p><br><p><font color="#CC6666">Video</font> <a href='http://www.econedlink.org/i196' target='_blank'>Trade, Exchange and Interdependence</a></p><p>This video teaches the concept of Trade, Exchange and Interdependence. People do not make everything that they and their family use: that is, they do not grow all their own food, sew their own clothes, build their own house and provide themselves ...<br><font size="-10"><br /></font><font size="-3">Date Published: 07/12/2012<br>Grades: 3-5, 6-8, 9-12<br />Source: <a href='http://www.econedlink.org/' target='_blank'>EconEdLink.org</a></font></p><br><p><font color="#CC6666">Video</font> <a href='http://www.econedlink.org/i224' target='_blank'>Benefits of Trade/Comparative Advantage</a></p><p>This video teaches the concepts of Benefits of Trade and Comparative Advantage. Comparative advantage is the principle which holds that world output is higher if every country produces and trades the good in which it has a comparative advantage. ...<br><font size="-10"><br /></font><font size="-3">Date Published: 07/12/2012<br>Grades: 6-8, 9-12<br />Source: <a href='http://www.econedlink.org/' target='_blank'>EconEdLink.org</a></font></p><br><p><font color="#CC6666">Video</font> <a href='http://www.econedlink.org/i123' target='_blank'>Making Sen$e with Paul Solman: Author Says Modern Life is Good Despite Recession</a></p><p>Author Matt Ridley says life is getting better and better despite the recession. Paul Solman reports on Ridley's optimism.<br><font size="-10"><br /></font><font size="-3">Date Published: 08/19/2010<br>Grades: 9-12<br />Source: <a href='http://www.econedlink.org/' target='_blank'>EconEdLink.org</a></font></p><br><p>-------------------------------------</p><p><b>Lessons:</b></p><br><p><a href='http://www.econedlink.org/e668' target='_blank'>Henry Ford and the Model T: A Case Study in Productivity (Part 1)</a></p><p>When Henry Ford announced he was going to produce an automobile that would be affordable to the masses, he probably did not realize what a great impact his achievement would have on life in the United States and, eventually, the world. Ford’s use of mass production strategies to manufacture the Model T revolutionized industrial manufacturing and initiated a new era in personal transportation. This three-part learning unit provides students with the story of Henry Ford and the Model T from an economics perspective. Parts 1 and 2 explore how the Ford Motor Company successfully introduced mass production strategies to the auto industry. Students learn how specialization and investments in capital (machines, people, etc.) increased productivity and allowed Ford to slash the price of his popular vehicle. Students chart a plan for the assembly-line production of bookmarks, test their plan, and make recommendations for improvements. Students also explore how Henry Ford used economic incentives to address a problem created by mass production techniques—worker turnover. An optional Part 3 explains how increased productivity resulted in shifts in the supply and demand for the Model T. Students analyze how a variety of non-price determinants continue to influence the automobile market today. The unit also presents a wealth of extension activities.<br><font size="-10"><br /></font><font size="-3">Date Published: 01/05/2007<br />Grades: 6-8, 9-12<br />Source: <a href='http://www.econedlink.org/' target='_blank'>EconEdLink.org</a></font></p><br><p><a href='http://www.econedlink.org/e676' target='_blank'>Henry Ford and the Model T: A Case Study in Productivity (Part 2)</a></p><p>When Henry Ford announced he was going to produce an automobile that would be affordable to the masses, he probably did not realize what a great impact his achievement would have on life in the United States. and, eventually, the world. Ford’s use of mass production strategies to manufacture the Model T revolutionized industrial manufacturing and initiated a new era in personal transportation. This three-part learning unit provides students with the story of Henry Ford and the Model T from an economics perspective. Parts 1 and 2 explore how the Ford Motor Company successfully introduced mass production strategies to the auto industry. Students learn how specialization and investments in capital (machines, people, etc.) increased productivity and allowed Ford to slash the price of his popular vehicle. Students chart a plan for the assembly line production of bookmarks, test their plan, and make recommendations for improvements. Students also explore how Henry Ford used economic incentives to address a problem created by mass production techniques—worker turnover. An optional Part 3 explains how increased productivity resulted in shifts in the supply and demand for the Model T. Students analyze how a variety of non-price determinants continue to influence the automobile market today. The unit also provides a wealth of extension activities. <br><font size="-10"><br /></font><font size="-3">Date Published: 01/05/2007<br />Grades: 6-8, 9-12<br />Source: <a href='http://www.econedlink.org/' target='_blank'>EconEdLink.org</a></font></p><br><p><a href='http://www.econedlink.org/e650' target='_blank'>Why does Brett Favre make $8.5 million per year?</a></p><p>What determines a person's salary? Why do professional athletes make so much money? People who work as firefighters, police officers or teachers are clearly more important to our society, yet they make much less money than jocks. What explains this?<br><font size="-10"><br /></font><font size="-3">Date Published: 06/06/2006<br />Grades: 9-12<br />Source: <a href='http://www.econedlink.org/' target='_blank'>EconEdLink.org</a></font></p><br><p><a href='http://www.econedlink.org/e539' target='_blank'>WIDGET PRODUCTION: Producing More, Using Less</a></p><p>In the first part of the lesson students take a quiz to review the major concepts taught in Lesson 7, "Widget Production," from Master Curriculum Guide in Economics: Teaching Strategies 5-6. Students then search the web for examples of the many ways in which productivity has been increased over the years. Finally, they identify a situation where an increase in productivity could alleviate a problem and create a way to solve this problem. They also analyze the costs and benefits of implementing their solutions.<br><font size="-10"><br /></font><font size="-3">Date Published: 02/19/2004<br />Grades: 3-5, 6-8<br />Source: <a href='http://www.econedlink.org/' target='_blank'>EconEdLink.org</a></font></p><br><p><a href='http://www.econedlink.org/e478' target='_blank'>Hawaiian Economics: Barter for Fish & Poi</a></p><p>In ancient Hawaii, chiefs managed the economy by creating a land division system, the Ahupua'a, which divided the islands into pie slice shapes. Each Ahupua'a covered the three main regions of the islands: the mountains, the valleys, and the beach. This system was designed to allow all Hawaiian communities equal access to the limited natural resources of the islands. However, it took a lot of time and energy to gather and grow all these resources, which were often spread out over great distances and located at different elevations. Many Hawaiians began to specialize in fishing and farming, and soon there was a need for Hawaiians to trade with one another to receive items they were no longer growing or gathering for themselves.<br><font size="-10"><br /></font><font size="-3">Date Published: 11/10/2003<br />Grades: 3-5<br />Source: <a href='http://www.econedlink.org/' target='_blank'>EconEdLink.org</a></font></p><br>]]></resources>
<related>
<concept>11</concept>
<concept>6</concept>
<concept>39</concept>
</related>
<quiz>1</quiz>
</concept>
<concept>
<id>38</id>
<name>Economic Development</name>
<category>3</category>
<definition><![CDATA[<p><b>Economic development</b> is a sustained increase in the <a href="event:function=defineGlossaryTerm,Standard of Living">standard of living</a> of a country's population. Broadly understood, the standard of living includes a rise in the average <a href="event:function=defineGlossaryTerm,Income">incomes</a> of the population as measured by real per capita GDP, and also improvements in health and education, some social protection from <a href="event:function=defineGlossaryTerm,Poverty">poverty</a>, freedom, a rule of law and other social <a href="event:function=defineGlossaryTerm,Goal">goals</a>. Thus, although economic development does focus on the material standard of living, it is a broader term than just economic growth. Economic development is facilitated by high <a href="event:function=defineGlossaryTerm,Investment">investment</a> levels in physical and <a href="event:function=defineGlossaryTerm,Human Capital">human capital</a>, higher <a href="event:function=defineGlossaryTerm,Productivity">productivity</a>, competitive <a href="event:function=defineGlossaryTerm,Markets">markets</a>, low <a href="event:function=defineGlossaryTerm,Inflation">inflation</a>, political stability and free <a href="event:function=defineGlossaryTerm,Trade">trade</a>. <a href="event:function=defineGlossaryTerm,Incentive">Incentives</a> that increase factors contributing to economic development are greater <a href="event:function=defineGlossaryTerm,Economic Freedom">economic freedom</a>, protection of <a href="event:function=defineGlossaryTerm,Property Rights">property rights</a> and sound monetary policies.</p>]]></definition>
<lessons><![CDATA[<p>Below are <b>featured</b> lessons for teaching Economic Development.</p><br><p class="tipHeading">High School Lessons</p><p>--------------------------------------------------------------------</p><p><a href="event:function=viewLesson,67736"><b>Lesson 10: Rising Living Standards in the New Nation</b></a><br><a href="event:function=viewPublication,105">Focus: Understanding Economics in U.S. History</a></p><br><p class="smaller_text">The students participate in a simulation that demonstrates an increase in productivity. They discuss ways in which productivity can be increased; then they learn how technology, exemplified by Eli Whitney's cotton gin (1793), increased productivit...</p><br><p>--------------------------------------------------------------------</p><p><a href="event:function=viewLesson,67729"><b>Lesson 3: Why Do Economies Grow?</b></a><br><a href="event:function=viewPublication,105">Focus: Understanding Economics in U.S. History</a></p><br><p class="smaller_text">The students examine information about former colonies and discuss factors associated with economic growth. They participate in a simulation activity, working in groups to recommend economic development policies for a newly discovered planet. Thro...</p><br><p>--------------------------------------------------------------------</p><p><a href="event:function=viewLesson,67642"><b>Lesson 7 - Globalization and the Environment</b></a><br><a href="event:function=viewPublication,109">Focus: Globalization</a></p><br><p class="smaller_text">A demonstration activity in which teams of students simulate a production process by shelling peanuts illustrates how "spillover" problems can affect people who are neither producers nor consumers of the product, sometimes including people who liv...</p><br><p>--------------------------------------------------------------------</p><p><a href="event:function=viewLesson,62515"><b>Lesson 10- How The Industrial Revolution Raised Living Standards</b></a><br><a href="event:function=viewPublication,70">World History: Focus on Economics</a></p><br><p class="smaller_text">The teacher conducts a brief simulation that illustrates how specialization and division of labor and improvements in capital goods increase productivity. The teacher displays a visual that shows other sources of increases in productivity. Studen...</p><br> <p>--------------------------------------------------------------------</p><p><a href="event:function=viewLesson,602"><b><font color="#CC6666">Online Lesson:</font> Closing the Gap</b></a><br><a href='http://www.econedlink.org/' target='_blank'>EconEdLink.org</a></p><br><p class="smaller_text">The students learn what GDP is. They will learn different measures of GDP as well as how GDP per capita can be used to compare countries. They will also calculate GDP per capita and learn how poorer countries can converge, or close the gap, with r...</p><br><p>--------------------------------------------------------------------</p><p><a href="event:function=viewLesson,154"><b><font color="#CC6666">Online Lesson:</font> The American Standard of Living - For Better or For Worse</b></a><br><a href='http://www.econedlink.org/' target='_blank'>EconEdLink.org</a></p><br><p class="smaller_text">Is the distribution of income in the United States becoming more unequal? Does the average American today have a higher or lower standard of living than the average American of a generation ago? Will the next generation have a higher or lower stan...</p><br><p class="tipHeading">Middle School Lessons</p><p>--------------------------------------------------------------------</p><p><a href="event:function=viewLesson,60338"><b>Lesson 8 - Ideas That Changed the World</b></a><br><a href="event:function=viewPublication,53">Middle School World Geography: Focus on Economics</a></p><br><p class="smaller_text">In this lesson, the students learn about productivity and its connection to the standard of living. They learn about inventions that changed the world. The students make predictions about recent inventions and the impact of these inventions on pro...</p><br><p>--------------------------------------------------------------------</p><p><a href="event:function=viewLesson,60333"><b>Lesson 3 - Economics and Population Demographics</b></a><br><a href="event:function=viewPublication,53">Middle School World Geography: Focus on Economics</a></p><br><p class="smaller_text">In this lesson, the students use data and graphs to analyze and compare the populations and standards of living for different countries. The students begin by building a population pyramid of the children in their families over three generations. ...</p><br><p>--------------------------------------------------------------------</p><p><a href="event:function=viewLesson,20766"><b>Lesson 4: Resources and Trade</b></a><br><a href="event:function=viewPublication,9">The Wide World of Trade</a></p><br><p class="smaller_text">Student groups represent people in different countries. Each group receives a packet of materials that represents productive resources. People in each country use the resources to provide food, clothing, shelter, businesses, and education. Beca...</p><br> <p>--------------------------------------------------------------------</p><p><a href="event:function=viewLesson,702"><b><font color="#CC6666">Online Lesson:</font> Work, Earnings and Economics: Using 'Lyddie' by Katherine Paterson</b></a><br><a href='http://www.econedlink.org/' target='_blank'>EconEdLink.org</a></p><br><p class="smaller_text">To get started, the students will read Lyddie, a novel by Katherine Paterson. The novel is set mainly in Lowell, Massachusetts, in the 1840s. In Lowell the main character, 13-year-old Lyddie Worthen, works six days a week, from dawn until dusk, ...</p><br>]]></lessons>
<tips><![CDATA[<p class="tipHeading">Tip #1</p><p>Many students believe that it is because of its natural resources that a country is rich or poor. Have the students compare some nations that are rich in natural resources (e.g., Russia and Nigeria) with countries that are poor in natural resources (e.g., Japan, Singapore and Switzerland). Obviously, the keys to long-term economic growth have less to do with the presence of natural resources and much more to do with the development of economic institutions, such as defining and enforcing private property rights. The keys to economic growth include technological innovation, investment in physical and human capital, low inflation, economic freedom and political stability.</p><br><p class="tipHeading">Tip #2</p><p>Economic development is more than economic growth. Economic growth can be measured in terms of a concrete measure, such as real GDP per capita. However, even corrected for price level changes (real) and differences in population (per capita), growth rates do not reveal everything about the well-being of the citizens of a country. Economic growth is a quantitative measure. Economic development encompasses qualitative measures. Factors such as the distribution of income, employment rates, educational attainment and health of citizens tell more about a country's level of development than does real GDP per capita alone.</p><br>]]></tips>
<resources><![CDATA[<p><b>Interactive tools:</b><br /></p><p><font color="#CC6666">Video</font> <a href='http://www.econedlink.org/i187' target='_blank'>Economic Systems</a></p><p>This video teaches the concept of Economic Systems. Economic systems can be categorized according to who makes most of the decisions in an economy: by individuals and firms or by government officials.<br><font size="-10"><br /></font><font size="-3">Date Published: 07/12/2012<br>Grades: 6-8, 9-12<br />Source: <a href='http://www.econedlink.org/' target='_blank'>EconEdLink.org</a></font></p><br><p><font color="#CC6666">Video</font> <a href='http://www.econedlink.org/i201' target='_blank'>Economic Growth</a></p><p>This video teaches the concept of Economic Growth. Economic growth refers to the ability of the economy to increase its total real output or real GDP, or its real output per person.<br><font size="-10"><br /></font><font size="-3">Date Published: 07/12/2012<br>Grades: 6-8, 9-12<br />Source: <a href='http://www.econedlink.org/' target='_blank'>EconEdLink.org</a></font></p><br><p><font color="#CC6666">Video</font> <a href='http://www.econedlink.org/i225' target='_blank'>Economic Development</a></p><p>This video teaches the concept of Economic Development. Economic development is a sustained increase in the standard of living of a country's population.<br><font size="-10"><br /></font><font size="-3">Date Published: 07/12/2012<br>Grades: 3-5, 6-8, 9-12<br />Source: <a href='http://www.econedlink.org/' target='_blank'>EconEdLink.org</a></font></p><br><p><font color="#CC6666">Video</font> <a href='http://www.econedlink.org/i246' target='_blank'>Making Sen$e with Paul Solman: Man vs. Machine: Will Human Workers Become Obsolete?</a></p><p>Part of his series on Making Sen$e of financial news, Paul Solman has been showcasing the future of technology from a recent conference run by a California think tank -- things such as 3-D printing of prosthetic legs and iPhone heart tests. But th...<br><font size="-10"><br /></font><font size="-3">Date Published: 05/24/2012<br>Grades: 9-12<br />Source: <a href='http://www.econedlink.org/' target='_blank'>EconEdLink.org</a></font></p><br><p><font color="#CC6666">Video</font> <a href='http://www.econedlink.org/i245' target='_blank'>Making Sen$e with Paul Solman: Downloadable Gun Parts, Personalized Bioterror: the Downside of Innovation</a></p><p>Through innovation and technology, California think tank Singularity University aims to push the frontiers of progress. But what happens when high-tech advances end up in the wrong hands? Economics correspondent Paul Solman raises some disturbing ...<br><font size="-10"><br /></font><font size="-3">Date Published: 04/26/2012<br>Grades: 9-12<br />Source: <a href='http://www.econedlink.org/' target='_blank'>EconEdLink.org</a></font></p><br><p>-------------------------------------</p><p><b>Lessons:</b></p><br><p><a href='http://www.econedlink.org/e719' target='_blank'>Transportation: They Say We Had a Revolution (Part 1)</a></p><p>Advancements in transportation have played a key role in the growth of our nation. U.S.government policies have also had a considerable impact on the development of transport as we know it today. In this series of three lessons,the students examine transportation and its impact on our nation (and vice versa) since the United States declared its independence in 1776. Lesson 1 focuses on improvements in transportation during the 19th century, particularly the development of a national rail system, to show how invention, innovation and infrastructure encouraged western expansion and economic growth. Lesson 2 moves on to the 20thcentury focusing on the development of auto transport and aviation. The impact on communities and world trade, for both good and bad,is examined. Lesson 3 calls upon the students to create a class time line of transportation milestones; the time line will help the students more clearly understand the factors, especially the economic incentives,that have played a key role in what has been called the 'Transportation Revolution.' While these three lessons will ideally be used together as a set, teachers may choose to use one or two of them, selectively, to focus, for example, on the 19th or the 20th century. If you would like your students to study the economics of transportation in more depth, consider following up with the EconEdLink lesson, An Economic Mystery: What Happened to Railroads?<br><font size="-10"><br /></font><font size="-3">Date Published: 01/30/2008<br />Grades: 6-8, 9-12<br />Source: <a href='http://www.econedlink.org/' target='_blank'>EconEdLink.org</a></font></p><br><p><a href='http://www.econedlink.org/e702' target='_blank'>Work, Earnings and Economics: Using 'Lyddie' by Katherine Paterson</a></p><p>To get started, the students will read Lyddie, a novel by Katherine Paterson. The novel is set mainly in Lowell, Massachusetts, in the 1840s. In Lowell the main character, 13-year-old Lyddie Worthen, works six days a week, from dawn until dusk, running weaving looms in a murky dust-and lintfilled factory, trying to save enough money to reunite her family. In reading and discussing this fine novel, the students examine basic economic concepts and explore the growth of labor unions and the role of government in a market economy.
Lyddie is published by Puffin Books and is available at Amazon.com. It is also available in DVD video format and may be purchased on line at Circuit City, DVD Empire.com and Overstock.com.<br><font size="-10"><br /></font><font size="-3">Date Published: 09/13/2007<br />Grades: 6-8<br />Source: <a href='http://www.econedlink.org/' target='_blank'>EconEdLink.org</a></font></p><br><p><a href='http://www.econedlink.org/e602' target='_blank'>Closing the Gap</a></p><p>The students learn what GDP is. They will learn different measures of GDP as well as how GDP per capita can be used to compare countries. They will also calculate GDP per capita and learn how poorer countries can converge, or close the gap, with richer countries.<br><font size="-10"><br /></font><font size="-3">Date Published: 10/27/2005<br />Grades: 9-12<br />Source: <a href='http://www.econedlink.org/' target='_blank'>EconEdLink.org</a></font></p><br><p><a href='http://www.econedlink.org/e560' target='_blank'>No Room For A Sneeze</a></p><p>This lesson teaches students about scarcity and standard of living. In the book "No Room for a Sneeze", a folktale retold by Robyn Supraner, a farmer and his wife must deal with scarcity in their home so they turn to the Wiseman for advice. The story tells students will learn about scarcity and ways to deal with scarcity.<br><font size="-10"><br /></font><font size="-3">Date Published: 03/27/2013<br />Grades: K-2<br />Source: <a href='http://www.econedlink.org/' target='_blank'>EconEdLink.org</a></font></p><br><p><a href='http://www.econedlink.org/e154' target='_blank'>The American Standard of Living - For Better or For Worse</a></p><p>Is the distribution of income in the United States becoming more unequal? Does the average American today have a higher or lower standard of living than the average American of a generation ago? Will the next generation have a higher or lower standard of living?<br><font size="-10"><br /></font><font size="-3">Date Published: 12/09/1998<br />Grades: 9-12<br />Source: <a href='http://www.econedlink.org/' target='_blank'>EconEdLink.org</a></font></p><br>]]></resources>
<related>
<concept>4</concept>
<concept>58</concept>
</related>
<quiz>1</quiz>
</concept>
<concept>
<id>58</id>
<name>Economic Growth</name>
<category>1</category>
<definition><![CDATA[<p><b>Economic growth</b> refers to the ability of the economy to increase its total real output or real GDP, or its real output per person. <a href="event:function=defineGlossaryTerm,Economic Growth">Economic growth</a> comes from several sources: improvements in the education, experience and skill level of the workforce, sometimes called <a href="event:function=defineGlossaryTerm,Human Capital">human capital</a>; greater amounts of physical <a href="event:function=defineGlossaryTerm,Capital">capital</a>, that is, plant and equipment per worker; discovery of new natural resources, or better management of existing ones; and improved technology. Economic growth is critical to job-creation and economic well-being. Economic growth slows down as the economy approaches its peak and becomes negative as it goes into <a href="event:function=defineGlossaryTerm,Recession">recession</a>. Economic growth begins increasing back toward zero as the economy approaches its trough and becomes positive as it begins its recovery.</p>]]></definition>
<lessons><![CDATA[<p>Below are <b>featured</b> lessons for teaching Economic Growth.</p><br><p class="tipHeading">High School Lessons</p><p>--------------------------------------------------------------------</p><p><a href="event:function=viewLesson,67729"><b>Lesson 3: Why Do Economies Grow?</b></a><br><a href="event:function=viewPublication,105">Focus: Understanding Economics in U.S. History</a></p><br><p class="smaller_text">The students examine information about former colonies and discuss factors associated with economic growth. They participate in a simulation activity, working in groups to recommend economic development policies for a newly discovered planet. Thro...</p><br><p>--------------------------------------------------------------------</p><p><a href="event:function=viewLesson,67644"><b>Lesson 9 - Globalization and Standards of Living: Prediction and Measurement</b></a><br><a href="event:function=viewPublication,109">Focus: Globalization</a></p><br><p class="smaller_text">In this lesson students consider ways to measure and then compare the degree of globalization and the standards of living in different countries. To introduce the idea of tracking complex social issues using different kinds of data, students plot ...</p><br><p>--------------------------------------------------------------------</p><p><a href="event:function=viewLesson,20821"><b>Lesson 7: The Mathematics of Nonlinear Economic Shapes: The Production Possibilities Curve</b></a><br><a href="event:function=viewPublication,11">Mathematics & Economics: Connections for Life - 9-12</a></p><br><p class="smaller_text">Because the resources (such as raw materials, minerals, energy, labor, equipment, machinery, etc.) that are used to produce goods and services are limited in their availability, we cannot have all that we want. When limited resources come into con...</p><br><p>--------------------------------------------------------------------</p><p><a href="event:function=viewLesson,62514"><b>Lesson 9- The Industrial Revolution</b></a><br><a href="event:function=viewPublication,70">World History: Focus on Economics</a></p><br><p class="smaller_text">Students read an introduction to the economic aspects of the Industrial Revolution, then work in small groups to develop lists of factors that encourage innovation. After class discussion of the lists, students analyze descriptions of the politic...</p><br> <p>--------------------------------------------------------------------</p><p><a href="event:function=viewLesson,773"><b><font color="#CC6666">Online Lesson:</font> Marketplace: Doing Business in Afghanistan</b></a><br><a href='http://www.econedlink.org/' target='_blank'>EconEdLink.org</a></p><br><p class="smaller_text">In May 2002, delegates from governments, international companies, and financial institutions met at a United Nations conference in Tehran to discuss the reconstruction of Afghanistan. Afghanistan's officials say that to create a viable economy and...</p><br><p>--------------------------------------------------------------------</p><p><a href="event:function=viewLesson,288"><b><font color="#CC6666">Online Lesson:</font> Economic Sectors and International Development</b></a><br><a href='http://www.econedlink.org/' target='_blank'>EconEdLink.org</a></p><br><p class="smaller_text">Using poverty rate as a measure of development, students select countries five at a time to compare how resources are allocated to three economic sectors (agriculture, industrial, service). After making comparisons, students will identify pat...</p><br><p>--------------------------------------------------------------------</p><p><a href="event:function=viewLesson,353"><b><font color="#CC6666">Online Lesson:</font> How is Our Economy Doing?</b></a><br><a href='http://www.econedlink.org/' target='_blank'>EconEdLink.org</a></p><br><p class="smaller_text">Students learn the meaning and measurement of six important economic indicators and use the St. Louis Federal Reserve Bank National Economic Trends website to assess the current state of the economy.</p><br><p>--------------------------------------------------------------------</p><p><a href="event:function=viewLesson,32"><b><font color="#CC6666">Online Lesson:</font> Population Growth: Friend or Foe?</b></a><br><a href='http://www.econedlink.org/' target='_blank'>EconEdLink.org</a></p><br><p class="smaller_text">The environment has recently been the focus of much research and discussion. Because productive resources are limited, it is important that we use resources wisely to ensure that resources will be available for use in future generations. Of...</p><br><p class="tipHeading">Middle School Lessons</p><p>--------------------------------------------------------------------</p><p><a href="event:function=viewLesson,702"><b><font color="#CC6666">Online Lesson:</font> Work, Earnings and Economics: Using 'Lyddie' by Katherine Paterson</b></a><br><a href='http://www.econedlink.org/' target='_blank'>EconEdLink.org</a></p><br><p class="smaller_text">To get started, the students will read Lyddie, a novel by Katherine Paterson. The novel is set mainly in Lowell, Massachusetts, in the 1840s. In Lowell the main character, 13-year-old Lyddie Worthen, works six days a week, from dawn until dusk, ...</p><br>]]></lessons>
<tips><![CDATA[<p class="tipHeading">Tip #1</p><p>When teaching about economic growth, it is important to include a discussion of the benefits of economic growth in terms of a nation's overall standard of living, that is, not just the individuals who have improved their human capital, but all their fellow citizens as well.</p><br><p class="tipHeading">Tip #2</p><p>Students should know the difference between economic growth and economic development. Economic growth can be measured in terms of some concrete measures, such as real GDP per capita. However, even corrected for price level changes (real) and differences in population (per capita), growth rates do not tell everything about the well-being of the citizens of a country. Economic growth is a quantitative measure. Economic development encompasses qualitative measures. Such things as distribution of income, employment rates, educational attainment and health of citizens tell more about a country's level of development than does an average income figure.</p><br><p class="tipHeading">Tip #3</p><p>Real GDP per capita may be a better indicator of economic growth than the percentage change in real GDP alone because it takes into consideration the population growth of the country.</p><br>]]></tips>
<resources><![CDATA[<p><b>Interactive tools:</b><br /></p><p><font color="#CC6666">Video</font> <a href='http://www.econedlink.org/i276' target='_blank'>Making Sen$e with Paul Solman: 'Tis the Season, But Should We Save or Spend? A Holiday Money Conundrum</a></p><p>Is saving money during the holidays smart or Scrooge-ish? Is shopping a way of forging social bonds and expressing your freedom or is it giving in to crass commercialism? Following the lessons of some "economist Christmas carols," economics corres...<br><font size="-10"><br /></font><font size="-3">Date Published: 12/20/2012<br>Grades: 9-12<br />Source: <a href='http://www.econedlink.org/' target='_blank'>EconEdLink.org</a></font></p><br><p><font color="#CC6666">Video</font> <a href='http://www.econedlink.org/i201' target='_blank'>Economic Growth</a></p><p>This video teaches the concept of Economic Growth. Economic growth refers to the ability of the economy to increase its total real output or real GDP, or its real output per person.<br><font size="-10"><br /></font><font size="-3">Date Published: 07/12/2012<br>Grades: 6-8, 9-12<br />Source: <a href='http://www.econedlink.org/' target='_blank'>EconEdLink.org</a></font></p><br><p><font color="#CC6666">Video</font> <a href='http://www.econedlink.org/i225' target='_blank'>Economic Development</a></p><p>This video teaches the concept of Economic Development. Economic development is a sustained increase in the standard of living of a country's population.<br><font size="-10"><br /></font><font size="-3">Date Published: 07/12/2012<br>Grades: 3-5, 6-8, 9-12<br />Source: <a href='http://www.econedlink.org/' target='_blank'>EconEdLink.org</a></font></p><br><p><font color="#CC6666">Video</font> <a href='http://www.econedlink.org/i182' target='_blank'>Making Sen$e with Paul Solman: What Do Tax Rates' Ups and Downs Mean for Economic Growth?</a></p><p>Do higher tax rates slow economic growth? As part of his reporting on Making Sen$e of financial news, economics correspondent Paul Solman takes a look at the history of taxes.
[Dec. 12, 2011]<br><font size="-10"><br /></font><font size="-3">Date Published: 12/12/2011<br>Grades: 9-12<br />Source: <a href='http://www.econedlink.org/' target='_blank'>EconEdLink.org</a></font></p><br><p><font color="#CC6666">Video</font> <a href='http://www.econedlink.org/i154' target='_blank'>Making Sen$e with Paul Solman: In Ohio, How 2 Counties' Economic Paths Diverged Over 30 Years</a></p><p>As part of his series on Making Sen$e of financial news, economics correspondent Paul Solman reports from two Ohio counties -- Crawford and Delaware -- that had similar incomes 30 years ago, but their economies and populations have since taken ver...<br><font size="-10"><br /></font><font size="-3">Date Published: 03/15/2011<br>Grades: 9-12<br />Source: <a href='http://www.econedlink.org/' target='_blank'>EconEdLink.org</a></font></p><br><p>-------------------------------------</p><p><b>Lessons:</b></p><br><p><a href='http://www.econedlink.org/e1074' target='_blank'>Spotlighting Entrepreneurs: A Technology "iCon"</a></p><p>What better way to address Common Core standards in Reading Informational Text than by meeting a gentleman that changed the world of technology!<br><font size="-10"><br /></font><font size="-3">Date Published: 03/11/2013<br />Grades: 3-5<br />Source: <a href='http://www.econedlink.org/' target='_blank'>EconEdLink.org</a></font></p><br><p><a href='http://www.econedlink.org/e773' target='_blank'>Marketplace: Doing Business in Afghanistan</a></p><p>In May 2002, delegates from governments, international companies, and financial institutions met at a United Nations conference in Tehran to discuss the reconstruction of Afghanistan. Afghanistan's officials say that to create a viable economy and a stable society, the country must recreate basic infrastructures --and it requires foreign investment to do so. But will businesses want to invest in Afghanistan? Correspondent Borzou Daragahi recently traveled to Afghanistan's business centers to see what life is like for the foreign entrepreneur.<br><font size="-10"><br /></font><font size="-3">Date Published: 02/26/2009<br />Grades: 6-8, 9-12<br />Source: <a href='http://www.econedlink.org/' target='_blank'>EconEdLink.org</a></font></p><br><p><a href='http://www.econedlink.org/e719' target='_blank'>Transportation: They Say We Had a Revolution (Part 1)</a></p><p>Advancements in transportation have played a key role in the growth of our nation. U.S.government policies have also had a considerable impact on the development of transport as we know it today. In this series of three lessons,the students examine transportation and its impact on our nation (and vice versa) since the United States declared its independence in 1776. Lesson 1 focuses on improvements in transportation during the 19th century, particularly the development of a national rail system, to show how invention, innovation and infrastructure encouraged western expansion and economic growth. Lesson 2 moves on to the 20thcentury focusing on the development of auto transport and aviation. The impact on communities and world trade, for both good and bad,is examined. Lesson 3 calls upon the students to create a class time line of transportation milestones; the time line will help the students more clearly understand the factors, especially the economic incentives,that have played a key role in what has been called the 'Transportation Revolution.' While these three lessons will ideally be used together as a set, teachers may choose to use one or two of them, selectively, to focus, for example, on the 19th or the 20th century. If you would like your students to study the economics of transportation in more depth, consider following up with the EconEdLink lesson, An Economic Mystery: What Happened to Railroads?<br><font size="-10"><br /></font><font size="-3">Date Published: 01/30/2008<br />Grades: 6-8, 9-12<br />Source: <a href='http://www.econedlink.org/' target='_blank'>EconEdLink.org</a></font></p><br><p><a href='http://www.econedlink.org/e702' target='_blank'>Work, Earnings and Economics: Using 'Lyddie' by Katherine Paterson</a></p><p>To get started, the students will read Lyddie, a novel by Katherine Paterson. The novel is set mainly in Lowell, Massachusetts, in the 1840s. In Lowell the main character, 13-year-old Lyddie Worthen, works six days a week, from dawn until dusk, running weaving looms in a murky dust-and lintfilled factory, trying to save enough money to reunite her family. In reading and discussing this fine novel, the students examine basic economic concepts and explore the growth of labor unions and the role of government in a market economy.
Lyddie is published by Puffin Books and is available at Amazon.com. It is also available in DVD video format and may be purchased on line at Circuit City, DVD Empire.com and Overstock.com.<br><font size="-10"><br /></font><font size="-3">Date Published: 09/13/2007<br />Grades: 6-8<br />Source: <a href='http://www.econedlink.org/' target='_blank'>EconEdLink.org</a></font></p><br><p><a href='http://www.econedlink.org/e692' target='_blank'>Henry Ford and the Model T: A Case Study in Productivity (Part 3)</a></p><p>When Henry Ford announced he was going to produce an automobile that would be affordable to the masses, it is doubtful even he realized the far reaching impact such an achievement would have on life in the U.S. and eventually, the world. Ford’s use of mass production strategies to manufacture the Model T revolutionized industrial manufacturing and initiated a new era in personal transportation. This 3-part learning unit provides students with the story of Henry Ford and the Model T from an economics perspective. Parts 1 and 2 explore how the Ford Motor Company successfully introduced mass production strategies to the auto industry. Students learn how specialization and investments in capital (machines, people, etc.) increased productivity and allowed Ford to slash the price of his popular vehicle. Students chart a plan for the assembly line production of bookmarks, test their plan and make recommendations for improvements. Students also explore how Henry Ford used economic incentives to address a problem created by mass production techniques—worker turnover. An optional Part 3 explains how increased productivity resulted in shifts in the supply and demand for the Model T. Students analyze how a variety of non price determinants continue to influence the automobile market today. A wealth of extension activities is provided if additional time is available.<br><font size="-10"><br /></font><font size="-3">Date Published: 01/15/2008<br />Grades: 6-8, 9-12<br />Source: <a href='http://www.econedlink.org/' target='_blank'>EconEdLink.org</a></font></p><br>]]></resources>
<related>
<concept>54</concept>
<concept>71</concept>
<concept>38</concept>
</related>
<quiz>1</quiz>
</concept>
<concept>
<id>3</id>
<name>Economic Institutions</name>
<category>0</category>
<definition><![CDATA[<p><b>Economic institutions</b> refer to the established laws, customs, organizations or systems that have a strong impact on economic decisions. Examples of laws that are <a href="event:function=defineGlossaryTerm,Economic Institutions">economic institutions</a> would include laws about enforcing contracts, antitrust laws and laws to protect the environment. Economic customs include, for example, the practice that most <a href="event:function=defineGlossaryTerm,Goods">goods</a> in market economies have <a href="event:function=defineGlossaryTerm,Price">prices</a> posted on them, rather than determining prices by bargaining. Organizations that serve at least in part as economic institutions include the federal government, the <a href="event:function=defineGlossaryTerm,Federal Reserve">Federal Reserve System</a>, <a href="event:function=defineGlossaryTerm,Firms">business firms</a> and unions. </p> ]]></definition>
<lessons><![CDATA[<p>Below are <b>featured</b> lessons for teaching Economic Institutions.</p><br><p class="tipHeading">High School Lessons</p><p>--------------------------------------------------------------------</p><p><a href="event:function=viewLesson,68110"><b>Lesson 7 - The Instruments and Institutions of Modern Financial Markets</b></a><br><a href="event:function=viewPublication,140">Teaching Financial Crises</a></p><br><p class="smaller_text">Students work in small groups to make flash cards to display terms commonly used in modern financial markets. Each group of students begins by learning one group of terms. The students pass their flash cards from group to group until everyone has ...</p><br><p>--------------------------------------------------------------------</p><p><a href="event:function=viewLesson,60261"><b>Lesson 11: "Hey, Hey! Ho, Ho! Why Do We Need the WTO?"</b></a><br><a href="event:function=viewPublication,39">Focus: Institutions and Markets</a></p><br><p class="smaller_text">Several activities are used to introduce students to six international institutions that play important economic roles, especially in the areas of international trade, finance, and development: the World Trade Organization (WTO), the Internationa...</p><br><p>--------------------------------------------------------------------</p><p><a href="event:function=viewLesson,65603"><b>Lesson 19: Privatization Around the World</b></a><br><a href="event:function=viewPublication,69">Focus: International Economics</a></p><br><p class="smaller_text">In this lesson, students review and evaluate the approaches most widely used to privatize public enterprises and services. They also review some international comparisons on the success of these programs in different nations. In the assessment s...</p><br><p>--------------------------------------------------------------------</p><p><a href="event:function=viewLesson,65690"><b>Lesson 7: Why Middlemen Matter: The Role of Financial Institutions in a Market Economy</b></a><br><a href="event:function=viewPublication,64">From Plan to Market: Teaching Ideas for Social Studies, Economics, and Business Classes</a></p><br><p class="smaller_text">Students participate in a simulation and analyze two case studies emphasizing the importance of the development of financial institutions in the transition economies.</p><br> <p>--------------------------------------------------------------------</p><p><a href="event:function=viewLesson,974"><b><font color="#CC6666">Online Lesson:</font> Focus on Economic Data: The Federal Reserve and Monetary Policy, November 3, 2010</b></a><br><a href='http://www.econedlink.org/' target='_blank'>EconEdLink.org</a></p><br><p class="smaller_text">This lesson focuses on the November 3, 2010, press release by the Federal Reserve System's Federal Open Market Committee (FOMC) on the current Federal Reserve monetary policy actions and goals. Specifically, the lesson reports the target rate for ...</p><br><p>--------------------------------------------------------------------</p><p><a href="event:function=viewLesson,10"><b><font color="#CC6666">Online Lesson:</font> Economics of Internet Access</b></a><br><a href='http://www.econedlink.org/' target='_blank'>EconEdLink.org</a></p><br><p class="smaller_text">You will learn why an understanding of shortages, supply, demand and the rationing function of prices is important as we encounter greater numbers of people logging on to the Internet. Find out how the FCC's new proposal of levying access cha...</p><br><p class="tipHeading">Middle School Lessons</p><p>--------------------------------------------------------------------</p><p><a href="event:function=viewLesson,68242"><b>Theme 4: Lesson 11 - Let Lenders and Borrowers Be</b></a><br><a href="event:function=viewPublication,136">Financial Fitness for Life: Grades 6-8 - Teacher Guide</a></p><br><p class="smaller_text">The students learn how financial intermediaries foster exchanges between savers and borrowers. They learn how savers and borrowers benefit from these exchanges; they also learn about the opportunity costs of saving and borrowing.</p><br> <p>--------------------------------------------------------------------</p><p><a href="event:function=viewLesson,918"><b><font color="#CC6666">Online Lesson:</font> How Global is Your Portfolio?</b></a><br><a href='http://www.econedlink.org/' target='_blank'>EconEdLink.org</a></p><br><p class="smaller_text">This engaging lesson challenges students to connect economics and geography as they investigate global companies in the stock market.</p><br><p class="tipHeading">Elementary Lessons</p><p>--------------------------------------------------------------------</p><p><a href="event:function=viewLesson,61984"><b>Lesson 3: What Happens When a Bank Makes a Loan?</b></a><br><a href="event:function=viewPublication,101">Learning, Earning and Investing: Grades 4-5 Lessons</a></p><br><p class="smaller_text">The students play roles in a simulation activity designed to show how bank loans made to individuals can have an impact on others in the community. Then, working in small groups, the students analyze other hypothetical loans, using flow charts or ...</p><br><p>--------------------------------------------------------------------</p><p><a href="event:function=viewLesson,20958"><b>Lesson 25: Obtaining a Bank Loan</b></a><br><a href="event:function=viewPublication,15">Exploring the Marketplace: The Community Publishing Company - Teacher Resource Manual</a></p><br><p class="smaller_text">This and the following lesson are designed to familiarize students with that process of obtaining a loan from a bank. You may choose either to invite a banker to visit the classroom or take a study trip to a bank to obtain a loan. Either of thes...</p><br> <p>--------------------------------------------------------------------</p><p><a href="event:function=viewLesson,455"><b><font color="#CC6666">Online Lesson:</font> Big Banks, Piggy Banks</b></a><br><a href='http://www.econedlink.org/' target='_blank'>EconEdLink.org</a></p><br><p class="smaller_text">When choosing a place to put their money, people consider how safe there money will be, how easy it is to access, and whether it will earn more money. Students explore how well different savings places achieve these objectives. Students learn...</p><br><p>--------------------------------------------------------------------</p><p><a href="event:function=viewLesson,256"><b><font color="#CC6666">Online Lesson:</font> Who Get's More than Their Fair Share?</b></a><br><a href='http://www.econedlink.org/' target='_blank'>EconEdLink.org</a></p><br><p class="smaller_text">This lesson has students continue to explore a variety of ways to share, particularly when an obvious solution is not apparent.</p><br>]]></lessons>
<tips><![CDATA[<p class="tipHeading">Tip #1</p><p>Have the students identify economic institutions in their community such as a bank, the local government (police and firefighters), the public schools and businesses. Discuss what these institutions do and how they contribute to the local economy.</p><br><p class="tipHeading">Tip #2</p><p>The students can visualize economic institutions associated with buildings. However, others, such as the legal system, may be more difficult to grasp. Ask the students how much more difficult life would be without the rule of law. How would people's property be protected? Would people have incentives to invent new goods, services and productive processes without the protection of private property? How much more difficult would it be to trade without a legal system?</p><br>]]></tips>
<resources><![CDATA[<p><b>Interactive tools:</b><br /></p><p><font color="#CC6666">Video</font> <a href='http://www.econedlink.org/i54' target='_blank'>Making Sen$e with Paul Solman: FDIC's Sheila Bair Answers Your Questions</a></p><p>FDIC Chair Sheila Bair answers NewsHour viewer's questions on too big to fail, the power of the banking lobby, and how to tell if a bank is healthy.<br><font size="-10"><br /></font><font size="-3">Date Published: 11/13/2009<br>Grades: 9-12<br />Source: <a href='http://www.econedlink.org/' target='_blank'>EconEdLink.org</a></font></p><br><p><font color="#CC6666">Video</font> <a href='http://www.econedlink.org/i55' target='_blank'>Making Sen$e with Paul Solman: FDIC's Bair: Bank Bailouts Were 'Not a Good Idea'</a></p><p>In an interview with Paul Solman, FDIC chairwoman Sheila Bair discusses lessons learned from the financial crisis.<br><font size="-10"><br /></font><font size="-3">Date Published: 11/13/2009<br>Grades: 9-12<br />Source: <a href='http://www.econedlink.org/' target='_blank'>EconEdLink.org</a></font></p><br><p><font color="#CC6666">Video</font> <a href='http://www.econedlink.org/i35' target='_blank'>Making Sen$e with Paul Solman: Making Sense of the Stress Tests</a></p><p>Paul Solman explains how the stress tests played into the government's decision to let 10 big banks repay the Treasury's bailout funds.<br><font size="-10"><br /></font><font size="-3">Date Published: 06/09/2009<br>Grades: 9-12<br />Source: <a href='http://www.econedlink.org/' target='_blank'>EconEdLink.org</a></font></p><br><p><font color="#CC6666">Video</font> <a href='http://www.econedlink.org/i260' target='_blank'>Making Sen$e with Paul Solman: Making Sen$e of Bailouts: Why the U.S. Government Bought 'Troubled Assets'</a></p><p><br><font size="-10"><br /></font><font size="-3">Date Published: 08/02/2012<br>Grades: 9-12<br />Source: <a href='http://www.econedlink.org/' target='_blank'>EconEdLink.org</a></font></p><br><p><font color="#CC6666">Video</font> <a href='http://www.econedlink.org/i149' target='_blank'>Making Sen$e with Paul Solman: How Severe is Europe's Intertwined Debt Crisis?</a></p><p>Economics correspondent Paul Solman reports on the ongoing fallout from Europe's debt crisis, which has led to political woes and bank bailouts.<br><font size="-10"><br /></font><font size="-3">Date Published: 01/24/2011<br>Grades: 9-12<br />Source: <a href='http://www.econedlink.org/' target='_blank'>EconEdLink.org</a></font></p><br><p>-------------------------------------</p><p><b>Lessons:</b></p><br><p><a href='http://www.econedlink.org/e700' target='_blank'>Who Is Ben Bernanke?</a></p><p>This lesson introduces students to the Chairman of the Federal Reserve System, Ben Bernanke. It describes briefly his involvement within the Federal Reserve.<br><font size="-10"><br /></font><font size="-3">Date Published: 06/08/2009<br />Grades: 9-12<br />Source: <a href='http://www.econedlink.org/' target='_blank'>EconEdLink.org</a></font></p><br><p><a href='http://www.econedlink.org/e543' target='_blank'>Business Ownership: The Franchise Option</a></p><p>Students explore an alternative to starting a business from scratch – investing in a franchise. They begin by considering the pros and cons of a franchise and whether this form of business is an option that would fit their personality and needs. Students then research and analyze franchise opportunities, ultimately selecting one that they think they might be able to successfully operate in their own community. While making their choice, students consider a variety of factors including their personal interests and abilities, the reputation of the product or service, the franchisor’s ability and willingness to assist the franchisee, and market factors such as consumer demand and anticipated competition.<br><font size="-10"><br /></font><font size="-3">Date Published: 04/21/2004<br />Grades: 9-12<br />Source: <a href='http://www.econedlink.org/' target='_blank'>EconEdLink.org</a></font></p><br><p><a href='http://www.econedlink.org/e533' target='_blank'>Business Ownership: How Sweet It Can Be!</a></p><p>In this lesson, students research the three basic types of business organization: sole proprietorships, partnerships, and corporations. Considering the advantages and disadvantages of each, they function as consultants offering advice on which form of business is best suited for different business scenarios. The case studies all feature real- life entrepreneurs who started businesses producing chocolate candy and cookies—they all result ultimately in “sweet” success stories. Once students have made their recommendations, they are provided the identities of their clients and asked to prepare reports that tell the rest of the story—what happened to each founder and business. Products featured in this lesson that almost every student will recognize are the Hershey chocolate bar, Mars M&Ms and Famous Amos chocolate cookies.<br><font size="-10"><br /></font><font size="-3">Date Published: 04/20/2004<br />Grades: 9-12<br />Source: <a href='http://www.econedlink.org/' target='_blank'>EconEdLink.org</a></font></p><br><p><a href='http://www.econedlink.org/e367' target='_blank'>The Role of a Bank Teller</a></p><p>In banking and finance, the role of a bank teller is a key feature. In this lesson, we will explore how bank tellers could make or break the banking world!<br><font size="-10"><br /></font><font size="-3">Date Published: 05/24/2005<br />Grades: 9-12<br />Source: <a href='http://www.econedlink.org/' target='_blank'>EconEdLink.org</a></font></p><br><p><a href='http://www.econedlink.org/e358' target='_blank'>Banks, Bankers, Banking</a></p><p>Students will demonstrate understanding of the processes associated with banking by role- playing as customers, tellers, and guards.<br><font size="-10"><br /></font><font size="-3">Date Published: 04/22/2003<br />Grades: 3-5<br />Source: <a href='http://www.econedlink.org/' target='_blank'>EconEdLink.org</a></font></p><br>]]></resources>
<related>
<concept>4</concept>
<concept>65</concept>
<concept>55</concept>
</related>
<quiz>1</quiz>
</concept>
<concept>
<id>4</id>
<name>Economic Systems</name>
<category>0</category>
<definition><![CDATA[<p><b>Economic systems</b> can be categorized according to who makes most of the decisions in an economy. In a <a href="event:function=defineGlossaryTerm,Market Economy">market economy</a>, most of the decisions in the economy about what to produce, how to produce it and who receives it are made by individuals and firms. At the other end of the spectrum, in a <a href="event:function=defineGlossaryTerm,Command Economy">command economy</a>, government officials make most of the decisions in the economy about what to produce, how to produce it and who receives it. Most <a href="event:function=defineGlossaryTerm,Economic Systems">economic systems</a> also contain elements of tradition or repeating decisions in ways made at an earlier time or by an earlier generation. Most economies are mixed in that some economic decisions are made by individuals and private <a href="event:function=defineGlossaryTerm,Firms">firms</a>, but some are also made by government officials, either through rules and <a href="event:function=defineGlossaryTerm,Regulation">regulations</a> or through government-owned firms. The U.S. economy leans toward the market-oriented side of the spectrum. An economy like Cuba or North Korea is near the command economy side of the spectrum. But the dividing line between market and command economies in most nations is blurry rather than bright.</p>]]></definition>
<lessons><![CDATA[<p>Below are <b>featured</b> lessons for teaching Economic Systems.</p><br><p class="tipHeading">High School Lessons</p><p>--------------------------------------------------------------------</p><p><a href="event:function=viewLesson,67727"><b>Lesson 1: The New World Was an Old World</b></a><br><a href="event:function=viewPublication,105">Focus: Understanding Economics in U.S. History</a></p><br><p class="smaller_text">This lesson introduces the Guide to Economic Reasoning. Students use the Guide to analyze certain practices of three Indian tribes at the time Europeans first encountered them. Students also use the Guide to solve two historic mysteries.</p><br><p>--------------------------------------------------------------------</p><p><a href="event:function=viewLesson,17800"><b>Unit 2: Lesson 6 - Why Did Communism Collapse?</b></a><br><a href="event:function=viewPublication,1">Capstone: Exemplary Lessons for High School Economics - Teacher's Guide</a></p><br><p class="smaller_text">Students examine and discuss visuals to solve an economic mystery regarding the command system of the Soviet Union.</p><br><p>--------------------------------------------------------------------</p><p><a href="event:function=viewLesson,63114"><b>Lesson 4: Sparta, Athens, Cuba and the United States: Ancient and Modern Examples of Command and Market Economies</b></a><br><a href="event:function=viewPublication,74">Focus: Economic Systems</a></p><br><p class="smaller_text">Students compare the economies of ancient Sparta and Athens using primary sources of speeches and other historical accounts. Students then compare the current economic systems of the United States and Cuba, using passages from their respective na...</p><br><p>--------------------------------------------------------------------</p><p><a href="event:function=viewLesson,65718"><b>Lesson 2: Who Decides?</b></a><br><a href="event:function=viewPublication,63">Economies in Transition: Command to Market</a></p><br><p class="smaller_text">Members of the class play roles in two different economic systems. Some are central planners of a command economy; others are resource owners and producers in a market economy. Both groups are given the same endowment of resource called "nech": ...</p><br><p>--------------------------------------------------------------------</p><p><a href="event:function=viewLesson,62513"><b>Lesson 8- Adam Smith And The Market Economy</b></a><br><a href="event:function=viewPublication,70">World History: Focus on Economics</a></p><br><p class="smaller_text">Students read a passage describing Adam Smith's concept of individual self-interest. Next, groups of students act as competitive producers or as investors in a simulation. Finally, they answer in writing several questions designed to debrief the...</p><br><p>--------------------------------------------------------------------</p><p><a href="event:function=viewLesson,62517"><b>Lesson 12- The Fall Of Communism</b></a><br><a href="event:function=viewPublication,70">World History: Focus on Economics</a></p><br><p class="smaller_text">Students read two passages describing life in the U.S.S.R. prior to its dissolution in 1991 and in small groups, analyze how the incentives present in the Soviet economy before the recent market reforms affected the performance of the economy.</p><br> <p>--------------------------------------------------------------------</p><p><a href="event:function=viewLesson,322"><b><font color="#CC6666">Online Lesson:</font> Comparative Economic Systems</b></a><br><a href='http://www.econedlink.org/' target='_blank'>EconEdLink.org</a></p><br><p class="smaller_text">Students research the economic systems of a communist country and a third-world country and compare them to the US, guided by questions and using information from the CIA World Factbook website.</p><br><p class="tipHeading">Middle School Lessons</p><p>--------------------------------------------------------------------</p><p><a href="event:function=viewLesson,60338"><b>Lesson 8 - Ideas That Changed the World</b></a><br><a href="event:function=viewPublication,53">Middle School World Geography: Focus on Economics</a></p><br><p class="smaller_text">In this lesson, the students learn about productivity and its connection to the standard of living. They learn about inventions that changed the world. The students make predictions about recent inventions and the impact of these inventions on pro...</p><br><p>--------------------------------------------------------------------</p><p><a href="event:function=viewLesson,60335"><b>Lesson 5 - Economic Freedom: How Important Is It?</b></a><br><a href="event:function=viewPublication,53">Middle School World Geography: Focus on Economics</a></p><br><p class="smaller_text">In this lesson, the students participate in activities that help them understand the correlation between economic freedom and a country's standard of living. First the students decide whether they agree or disagree with rules and laws that affect ...</p><br><p>--------------------------------------------------------------------</p><p><a href="event:function=viewLesson,20766"><b>Lesson 4: Resources and Trade</b></a><br><a href="event:function=viewPublication,9">The Wide World of Trade</a></p><br><p class="smaller_text">Student groups represent people in different countries. Each group receives a packet of materials that represents productive resources. People in each country use the resources to provide food, clothing, shelter, businesses, and education. Beca...</p><br><p>--------------------------------------------------------------------</p><p><a href="event:function=viewLesson,61971"><b>Lesson 4 - What, How and For Whom to Produce?</b></a><br><a href="event:function=viewPublication,37">Roosters to Robots: Lesson Plans from Writers around the World</a></p><br><p class="smaller_text">Students produce badges as rewards for the best economists in the class. Through this production activity, they learn how command and market economies answer the basic economic questions: What to produce? How to produce? For whom to produce?</p><br> <p class="tipHeading">Elementary Lessons</p><p>--------------------------------------------------------------------</p><p><a href="event:function=viewLesson,62347"><b>Lesson 2: What? How? For Whom?</b></a><br><a href="event:function=viewPublication,59">Master Curriculum Guides in Economics: Teaching Strategies - 5-6</a></p><br><p class="smaller_text">An economic system is the way society organizes the production and consumption of goods and services. Every economic system answers three basic economic questions: What to produce? How to produce? And For whom to produce? How a society answers t...</p><br> <p>--------------------------------------------------------------------</p><p><a href="event:function=viewLesson,256"><b><font color="#CC6666">Online Lesson:</font> Who Get's More than Their Fair Share?</b></a><br><a href='http://www.econedlink.org/' target='_blank'>EconEdLink.org</a></p><br><p class="smaller_text">This lesson has students continue to explore a variety of ways to share, particularly when an obvious solution is not apparent.</p><br>]]></lessons>
<tips><![CDATA[<p class="tipHeading">Tip #1</p><p>The important point for the students to understand is that all economic systems are mixed. Any economic system has elements of command, market and tradition. Ask the students for examples of each element in the U.S. economy.</p><br><p class="tipHeading">Tip #2</p><p>A command economic system is sometimes confused with a dictatorship. A command economy often is run by a dictator such as Stalin or Castro, but democracies can also have large elements of command in the economy. The key is to remember that command decisions are made by government. These decisions are made by non-elected officials in a dictatorship and by elected officials in a democracy. In either case, command decisions are enforced by coercion. If the majority decides on a government program, you must pay taxes to support that program even if you disagree with that program. You must obey government laws or suffer the consequences.</p><br><p class="tipHeading">Tip #3</p><p>An allocation activity helps the students recognize that who makes decisions determines the type of economic system. Have an item that most students in your class would like. For example, bring a can of cold soda after recess or make a "get out of homework free" coupon. Ask how many students would like to have the item. Explain that many students want it so a decision will have to be made about who gets it. Ask the students to suggest ways in which this decision can be made. Most suggestions can generally be categorized as lottery, authority decides, highest bidder, need, force and first-come, first-served. With these categories, it is then possible to discuss who makes the decision and who benefits or loses as a result. Then links can be made to how allocation decisions are made in the students' society.</p><br>]]></tips>
<resources><![CDATA[<p><b>Interactive tools:</b><br /></p><p><font color="#CC6666">Video</font> <a href='http://www.econedlink.org/i153' target='_blank'>Making Sen$e with Paul Solman: Many Americans Feel 'Stuck in a Rut' as Economy Improves, But Inequality Grows</a></p><p>As part of his continuing coverage of Making Sen$e of economic news, Paul Solman examines the struggles to close the widening U.S. inequality gap, even as the economy improves.<br><font size="-10"><br /></font><font size="-3">Date Published: 03/24/2011<br>Grades: 9-12<br />Source: <a href='http://www.econedlink.org/' target='_blank'>EconEdLink.org</a></font></p><br><p><font color="#CC6666">Video</font> <a href='http://www.econedlink.org/i126' target='_blank'>Making Sen$e with Paul Solman: The Current State of Religion in America</a></p><p>Paul Solman sits down with political scientist Robert Putnam to discuss his new book "American Grace", about the current role religion plays in America.<br><font size="-10"><br /></font><font size="-3">Date Published: 10/11/2010<br>Grades: 9-12<br />Source: <a href='http://www.econedlink.org/' target='_blank'>EconEdLink.org</a></font></p><br><p><font color="#CC6666">Video</font> <a href='http://www.econedlink.org/i19' target='_blank'>Making Sen$e with Paul Solman: Historian Finds Positive Side of Economic Downturn</a></p><p>Great Depression historian Robert McElvaine found that economic downturns can cut down on consumption and help people focus on what really matters in life.<br><font size="-10"><br /></font><font size="-3">Date Published: 03/27/2009<br>Grades: 9-12<br />Source: <a href='http://www.econedlink.org/' target='_blank'>EconEdLink.org</a></font></p><br><p><font color="#CC6666">Video</font> <a href='http://www.econedlink.org/i184' target='_blank'>Decision Making/Cost-Benefit Analysis</a></p><p>This video teaches the concepts of Decision Making and Cost-Benefit Analysis. Decision making refers to the process by which rational consumers seeking their own happiness or utility will make choices. Cost-benefit analysis is a technique for deci...<br><font size="-10"><br /></font><font size="-3">Date Published: 07/12/2012<br>Grades: 3-5, 6-8, 9-12<br />Source: <a href='http://www.econedlink.org/' target='_blank'>EconEdLink.org</a></font></p><br><p><font color="#CC6666">Video</font> <a href='http://www.econedlink.org/i186' target='_blank'>Economic Institutions</a></p><p>This video teaches the concept of Economic Institutions. Economic institutions refer to the established laws, customs, organizations or systems that have a strong impact on economic decisions.<br><font size="-10"><br /></font><font size="-3">Date Published: 07/12/2012<br>Grades: 9-12<br />Source: <a href='http://www.econedlink.org/' target='_blank'>EconEdLink.org</a></font></p><br><p>-------------------------------------</p><p><b>Lessons:</b></p><br><p><a href='http://www.econedlink.org/e702' target='_blank'>Work, Earnings and Economics: Using 'Lyddie' by Katherine Paterson</a></p><p>To get started, the students will read Lyddie, a novel by Katherine Paterson. The novel is set mainly in Lowell, Massachusetts, in the 1840s. In Lowell the main character, 13-year-old Lyddie Worthen, works six days a week, from dawn until dusk, running weaving looms in a murky dust-and lintfilled factory, trying to save enough money to reunite her family. In reading and discussing this fine novel, the students examine basic economic concepts and explore the growth of labor unions and the role of government in a market economy.
Lyddie is published by Puffin Books and is available at Amazon.com. It is also available in DVD video format and may be purchased on line at Circuit City, DVD Empire.com and Overstock.com.<br><font size="-10"><br /></font><font size="-3">Date Published: 09/13/2007<br />Grades: 6-8<br />Source: <a href='http://www.econedlink.org/' target='_blank'>EconEdLink.org</a></font></p><br><p><a href='http://www.econedlink.org/e136' target='_blank'>One Country / Two Systems</a></p><p>It has been one and a half years since British rule ended in Hong Kong and control of the city was returned to China. Under the Joint Declaration, Hong Kong is guaranteed a high degree of autonomy from China for fifty years as a Special Autonomous Region (SAR) of the People's Republic of China under the principles of "One Country/Two Systems" and "Hong Kong People Governing Hong Kong." In this lesson, you will visit web sites that will help you compare and evaluate the economic and political systems of China and Hong Kong.<br><font size="-10"><br /></font><font size="-3">Date Published: 12/28/1998<br />Grades: 9-12<br />Source: <a href='http://www.econedlink.org/' target='_blank'>EconEdLink.org</a></font></p><br><p><a href='http://www.econedlink.org/e795' target='_blank'>Traditional Economies and the Inuit</a></p><p>The Inuit people of northern Canada provide an example of a traditional economy. For thousands of years, Inuit parents have taught their children the survival skills needed to survive in the Arctic Circle's severe climate. Students will research the Inuit economy and compare and contrast it with the United States' market economy.<br><font size="-10"><br /></font><font size="-3">Date Published: 01/12/2010<br />Grades: 9-12<br />Source: <a href='http://www.econedlink.org/' target='_blank'>EconEdLink.org</a></font></p><br><p><a href='http://www.econedlink.org/e593' target='_blank'>Keynes vs. Hayek: The Rise of the Chicago School of Economics</a></p><p>Economic freedom is freedom from government intervention in the production and distribution of goods and services. After World War II, governments were trying to rebuild their economies from the ground up. They looked to the ideas of the top economists of their day for guidance. These ideas have shaped economic systems and the idea of economic freedom for many years.<br><font size="-10"><br /></font><font size="-3">Date Published: 06/22/2005<br />Grades: 9-12<br />Source: <a href='http://www.econedlink.org/' target='_blank'>EconEdLink.org</a></font></p><br><p><a href='http://www.econedlink.org/e535' target='_blank'>The Price We Pay for Health: US and Canada</a></p><p>Students will review the health systems of United States and Canada. They will identify the positive aspects of each system. They will look at the trade-offs associated with those positive aspects. In Canada, everyone has health care, but certain specialized medical services are not always available. In the United States, many people are not insured, yet for many people the access to technology and specialization is phenomenal. Which is the better choice? Students will also recognize that choosing between these two systems requires a trade-off between the economic goals of economic freedom and economic security.<br><font size="-10"><br /></font><font size="-3">Date Published: 03/03/2004<br />Grades: 9-12<br />Source: <a href='http://www.econedlink.org/' target='_blank'>EconEdLink.org</a></font></p><br>]]></resources>
<related>
<concept>1</concept>
<concept>3</concept>
<concept>57</concept>
<concept>38</concept>
</related>
<quiz>1</quiz>
</concept>
<concept>
<id>35</id>
<name>Elasticity of Demand</name>
<category>2</category>
<definition><![CDATA[<p><a href="event:function=defineGlossaryTerm,Price Elasticity of Demand"><b>Price elasticity of demand</b></a> is the way of measuring how much <a href="event:function=defineGlossaryTerm,Quantity Demanded">quantity demanded</a> will change in response to a change in <a href="event:function=defineGlossaryTerm,Price">price</a>. The formula for price elasticity of demand is the percentage change in quantity demanded divided by the percentage change in price. The advantage of measuring elasticities in terms of percentage change is that the specific units being used to measure the quantity and the price don't matter--only the percentages.</p><br><p>If the elasticity of demand is greater than 1, then a price increase of, say, 10 percent will cause a decrease in quantity demanded of more than 10 percent. This case is referred to as elastic demand. If the elasticity of demand is equal to 1, then a price increase of 10 percent will cause a decrease in quantity demanded of 10 percent. This case is referred to as unitary elasticity of demand. Finally, if the elasticity of demand is less than 1, then a rise in the price of 10 percent will result in a decrease in quantity demanded of less than 10 percent. This case is referred to as inelastic demand. In other words, elastic demand refers to a relatively large response of quantity demanded to changes in price, while inelastic demand refers to a relatively small response of quantity demanded to change in price.</p><br><p>Knowing the elasticity of demand is useful when determining the effects of price changes on quantity demanded. A firm has more power over price changes if demand is inelastic.</p><br><p>Price elasticity of demand is always a negative number, since a higher price leads to lower quantity demanded and vice versa. However, it is common practice to ignore the negative sign, so don't be surprised if you see it expressed as a positive number.</p>]]></definition>
<lessons><![CDATA[<p>Below are <b>featured</b> lessons for teaching Elasticity of Demand.</p><br><p class="tipHeading">High School Lessons</p><p>--------------------------------------------------------------------</p><p><a href="event:function=viewLesson,17806"><b>Unit 2: Lesson 12 - How Do Prices Influence My Behavior? Price Elasticity</b></a><br><a href="event:function=viewPublication,1">Capstone: Exemplary Lessons for High School Economics - Teacher's Guide</a></p><br><p class="smaller_text">Students review consumer and producer behavior in light of changing prices. They predict consumers' and producers' responses to changes in prices, product characteristics, costs of production, time and technology factors.</p><br><p>--------------------------------------------------------------------</p><p><a href="event:function=viewLesson,20820"><b>Lesson 6: The Mathematics of Linear Economic Shapes: Slopes and Elasticities</b></a><br><a href="event:function=viewPublication,11">Mathematics & Economics: Connections for Life - 9-12</a></p><br><p class="smaller_text">As was noted in Lessons 1 - 4, a demand curve is used to describe the willingness and ability of buyers to purchase various quantities of goods and services at alternative prices. The visual representation of this relationship is a linear function...</p><br><p>--------------------------------------------------------------------</p><p><a href="event:function=viewLesson,551"><b><font color="#CC6666">Online Lesson:</font> Price Elasticity: From Tires to Toothpicks</b></a><br><a href='http://www.econedlink.org/' target='_blank'>EconEdLink.org</a></p><br><p class="smaller_text">Students gain an understanding of price elasticity of demand and why different goods have different degrees of elasticity. Students learn how to calculate price elasticity of goods.</p><br>]]></lessons>
<tips><![CDATA[<p class="tipHeading">Tip #1</p><p>Price elasticity of demand is the response of the quantity demanded to a change in price. A large response is called elastic demand while a small response is called inelastic demand. You can illustrate the different effects using two balls. Drop a baseball and see how much it bounces (inelastic demand). Then drop a tennis ball and see how much it bounces (elastic demand). Note that the baseball bounces but less than the tennis ball. Inelastic demand does not mean there is no response; it means there is a small response. The percentage change in the quantity demanded is less than the percentage change in price.</p><br><p class="tipHeading">Tip #2</p><p>Many students believe the myth of vertical demand. They think that for some goods a change in price will not influence the quantity demanded. They confuse no change with a percentage change in the quantity demanded less than the percentage change in price. This leads to poor logic. For example, "higher gasoline prices will not discourage gas consumption." Even in the short run, higher gasoline prices will discourage gas consumption even if the percentage decrease in the quantity demanded is less than the percentage increase in price. In the long run, consumers can find creative substitutes for gas such as more fuel-efficient cars or living closer to work, and the percentage decrease in the quantity demanded will be even greater.</p><br><p class="tipHeading">Tip #3</p><p>Even necessities with inelastic demand curves become more elastic if there are many firms competing to sell them. One firm's product becomes a substitute for another firm's product. Competition increases elasticity of demand.</p><br><p class="tipHeading">Tip #4</p><p>A quick activity is to make statements describing the characteristics of products and have the students determine if the product has an elastic or inelastic demand and explain why. Some products might be salt, insulin, steak, autos and yachts.</p><br>]]></tips>
<resources><![CDATA[<p><b>Interactive tools:</b><br /></p><p><font color="#CC6666">Video</font> <a href='http://www.econedlink.org/i211' target='_blank'>Elasticity of Demand</a></p><p>This video teaches the concept of Elasticity of Demand. Price elasticity of demand is the way of measuring how much quantity demanded will change in response to a change in price.<br><font size="-10"><br /></font><font size="-3">Date Published: 07/12/2012<br>Grades: 6-8, 9-12<br />Source: <a href='http://www.econedlink.org/' target='_blank'>EconEdLink.org</a></font></p><br><p><font color="#CC6666">Video</font> <a href='http://www.econedlink.org/i188' target='_blank'>Incentives</a></p><p>This video teaches the concept of Incentives. An incentive is a cost or benefit that motivates a decision or action by consumers, workers, firms or other participants in the economy.<br><font size="-10"><br /></font><font size="-3">Date Published: 07/12/2012<br>Grades: 3-5, 6-8, 9-12<br />Source: <a href='http://www.econedlink.org/' target='_blank'>EconEdLink.org</a></font></p><br><p><font color="#CC6666">Video</font> <a href='http://www.econedlink.org/i210' target='_blank'>Demand</a></p><p>This video teaches the concept of Demand. Demand refers to a relationship between price and the quantity of a good or service that consumers demand.<br><font size="-10"><br /></font><font size="-3">Date Published: 07/12/2012<br>Grades: 3-5, 6-8, 9-12<br />Source: <a href='http://www.econedlink.org/' target='_blank'>EconEdLink.org</a></font></p><br><p>-------------------------------------</p><p><b>Lessons:</b></p><br><p><a href='http://www.econedlink.org/e551' target='_blank'>Price Elasticity: From Tires to Toothpicks</a></p><p>Students gain an understanding of price elasticity of demand and why different goods have different degrees of elasticity. Students learn how to calculate price elasticity of goods.<br><font size="-10"><br /></font><font size="-3">Date Published: 07/12/2004<br />Grades: 9-12<br />Source: <a href='http://www.econedlink.org/' target='_blank'>EconEdLink.org</a></font></p><br>]]></resources>
<related>
<concept>8</concept>
<concept>23</concept>
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<quiz>1</quiz>
</concept>
<concept>
<id>61</id>
<name>Employment and Unemployment</name>
<category>1</category>
<definition><![CDATA[<p><b>Employment</b> refers to people who have <a href="event:function=defineGlossaryTerm,Job">jobs</a>. <b>Unemployment</b> occurs when people wish to work but cannot find jobs. The adult population of working age can be divided into three groups. Those who are "not in the <a href="event:function=defineGlossaryTerm,Labor Force">labor force</a>" are those adults who do not have jobs and are not seeking jobs. Those who are in the labor force are then split into two groups: those who are employed, and those who don't have jobs but are looking for them. The employment/population ratio is the number of people with jobs divided by the total adult population of working age. The labor force participation rate is the number of people in the labor force divided by the total adult population of working age. The <a href="event:function=defineGlossaryTerm,Unemployment Rate">unemployment rate</a> is the number of unemployed people divided by the number of people in the labor force. Because people can choose whether or not to enter the labor force, employment and <a href="event:function=defineGlossaryTerm,Unemployment">unemploymen</a>t can simultaneously increase or decrease.</p> ]]></definition>
<lessons><![CDATA[<p>Below are <b>featured</b> lessons for teaching Employment and Unemployment.</p><br><p class="tipHeading">High School Lessons</p><p>--------------------------------------------------------------------</p><p><a href="event:function=viewLesson,68105"><b>Lesson 2 - How Economic Performance From 2007-2009 Compares to Other Periods in U.S. History</b></a><br><a href="event:function=viewPublication,140">Teaching Financial Crises</a></p><br><p class="smaller_text">The students examine information and data about six recessions in the United States. In small groups, they use the information to make short presentations about the recessions, highlighting data on economic performance during the time periods, and...</p><br><p>--------------------------------------------------------------------</p><p><a href="event:function=viewLesson,68044"><b>Lesson 18 - Economic Indicators for Informed Citizens</b></a><br><a href="event:function=viewPublication,118">Focus: Understanding Economics in Civics and Government</a></p><br><p class="smaller_text">This lesson introduces students to three basic economic indicators: real GDP, the inflation rate, and the unemployment rate. The students work in small groups to develop an economic forecast, using the three basic economic indicators. They partici...</p><br><p>--------------------------------------------------------------------</p><p><a href="event:function=viewLesson,67760"><b>Lesson 34: Women in the U.S. Workforce</b></a><br><a href="event:function=viewPublication,105">Focus: Understanding Economics in U.S. History</a></p><br><p class="smaller_text">The students examine information about changes in the number of women participating in the labor force during and immediately after World War II. They are asked to explain the increase in the number of women working outside the home. They examine ...</p><br><p>--------------------------------------------------------------------</p><p><a href="event:function=viewLesson,17825"><b>Unit 6: Lesson 31 - Measuring Unemployment: A Labor Market Mystery</b></a><br><a href="event:function=viewPublication,1">Capstone: Exemplary Lessons for High School Economics - Teacher's Guide</a></p><br><p class="smaller_text">Students examine an economic mystery regarding employment and unemployment statistics. They learn how the Bureau of Labor Statistics measures employment and unemployment. They use the Guide to Economic Reasoning and some arithmetic to solve the ...</p><br><p>--------------------------------------------------------------------</p><p><a href="event:function=viewLesson,63119"><b>Lesson 9: The Mysteries of Unemployment: How Can You Hide Something So Macro?</b></a><br><a href="event:function=viewPublication,74">Focus: Economic Systems</a></p><br><p class="smaller_text">Students learn how economists measure the labor force, unemployment and labor productivity and see how international differences in national employment goals and procedures for measuring unemployment can make it difficult to compare the performanc...</p><br> <p>--------------------------------------------------------------------</p><p><a href="event:function=viewLesson,977"><b><font color="#CC6666">Online Lesson:</font> Focus on Economic Data: U.S. Real GDP Growth, November 23, 2010</b></a><br><a href='http://www.econedlink.org/' target='_blank'>EconEdLink.org</a></p><br><p class="smaller_text">This lesson focuses on the November 23, 2010, second estimate of U.S. real gross domestic product (real GDP) growth for the third quarter (Q3) of 2010, as reported by the U.S. Bureau of Economic Analysis (BEA). The current GDP data and historical ...</p><br><p>--------------------------------------------------------------------</p><p><a href="event:function=viewLesson,785"><b><font color="#CC6666">Online Lesson:</font> The Unemployment Game</b></a><br><a href='http://www.econedlink.org/' target='_blank'>EconEdLink.org</a></p><br><p class="smaller_text">Students will learn about important labor market statistics that are frequently discussed in the media. An understanding of the unemployment rate and labor force participation rate will be developed through participation in an interactive simulat...</p><br><p>--------------------------------------------------------------------</p><p><a href="event:function=viewLesson,351"><b><font color="#CC6666">Online Lesson:</font> Unemployment in My Hometown</b></a><br><a href='http://www.econedlink.org/' target='_blank'>EconEdLink.org</a></p><br><p class="smaller_text">Students use the Bureau of Labor Statistics website to track unemployment rates for their community, and after researching information about the industrial makeup of their community, explain whether their local unemployment rates tend to rema...</p><br><p>--------------------------------------------------------------------</p><p><a href="event:function=viewLesson,27"><b><font color="#CC6666">Online Lesson:</font> U.S. Senate Rejects Minimum Wage Bill</b></a><br><a href='http://www.econedlink.org/' target='_blank'>EconEdLink.org</a></p><br><p class="smaller_text">In 1998, the Senate voted to reject a $1 increase in the federal hourly minimum wage. The vote fell along party lines, with Democrats voting in favor of the proposal and Republicans voting against it. Interview your classmates to find arg...</p><br><p class="tipHeading">Elementary Lessons</p><p>--------------------------------------------------------------------</p><p><a href="event:function=viewLesson,62325"><b>Lesson 13: The Working World</b></a><br><a href="event:function=viewPublication,58">Master Curriculum Guides in Economics: Teaching Strategies - 3-4</a></p><br><p class="smaller_text">Human capital consists of the skills, knowledge, and other factors, such as health, that improve an individual's ability to produce goods and services. One reason people earn different incomes for different jobs is that they differ in the quantit...</p><br> ]]></lessons>
<tips><![CDATA[<p class="tipHeading">Tip #1</p><p>Information reported by the media on unemployment is not as straightforward as it might appear. Tell the students that 1) workers who are without jobs but have stopped looking for work (discouraged workers) are not counted as unemployed, 2) part-time workers are counted as employed, not unemployed and 3) unemployed workers who are looking for only part-time jobs are counted as unemployed in the same way as those seeking full-time work.</p><br><p class="tipHeading">Tip #2</p><p>A good economic mystery to present to your class is how the unemployment rate can increase at the same time that more people are getting jobs. The answer is that the unemployment rate is the number of unemployed people divided by the number of people in the labor force or those people who are willing and able to work. During improving economic conditions, the labor force increases because formerly discouraged workers now rejoin the work force. The size of the work force is also affected by those workers who choose to retire and new workers entering the labor force. For these reasons, the unemployment rate can decrease when fewer people are getting jobs.</p><br>]]></tips>
<resources><![CDATA[<p><b>Interactive tools:</b><br /></p><p><font color="#CC6666">Video</font> <a href='http://www.econedlink.org/i202' target='_blank'>Employment and Unemployment</a></p><p>This video teaches the concepts of Employment and Unemployment. Employment refers to people who have jobs while unemployment refers to people who wish to work but cannot find jobs.<br><font size="-10"><br /></font><font size="-3">Date Published: 07/12/2012<br>Source: <a href='http://www.econedlink.org/' target='_blank'>EconEdLink.org</a></font></p><br><p><font color="#CC6666">Video</font> <a href='http://www.econedlink.org/i172' target='_blank'>Making Sen$e with Paul Solman: Can America's Jobless Fill American Jobs?</a></p><p>With the U.S. unemployment rate stuck around 9 percent, economics correspondent Paul Solman explores whether widespread joblessness is simply the result of a weak economy or if a broader shift toward higher-skill work is occurring that could leave...<br><font size="-10"><br /></font><font size="-3">Date Published: 09/02/2011<br>Grades: 9-12<br />Source: <a href='http://www.econedlink.org/' target='_blank'>EconEdLink.org</a></font></p><br><p><font color="#CC6666">Video</font> <a href='http://www.econedlink.org/i37' target='_blank'>Making Sen$e with Paul Solman: Many Left Uncounted in Official Jobless Rate</a></p><p>Paul Solman shows how the number of people who fall outside of official jobless rates indicates that the actual unemployment rate is higher than reported.<br><font size="-10"><br /></font><font size="-3">Date Published: 07/02/2009<br>Grades: 9-12<br />Source: <a href='http://www.econedlink.org/' target='_blank'>EconEdLink.org</a></font></p><br><p><font color="#CC6666">Video</font> <a href='http://www.econedlink.org/i264' target='_blank'>Making Sen$e with Paul Solman: Is Applying for Jobs Online Not an Effective Way to Find Work?</a></p><p>With a bad economy and nearly everyone on the internet, one job opening promoted online can receive thousands of applications. So with competition fierce and many firms using software rather than human beings to hire, Paul Solman explores whether ...<br><font size="-10"><br /></font><font size="-3">Date Published: 09/25/2012<br>Grades: 9-12<br />Source: <a href='http://www.econedlink.org/' target='_blank'>EconEdLink.org</a></font></p><br><p><font color="#CC6666">Video</font> <a href='http://www.econedlink.org/i259' target='_blank'>Making Sen$e with Paul Solman: Paul Krugman's Solution to Getting Fiscal Stimulus? It Involves Aliens</a></p><p>Amid a tough economy, economist and New York Times columnist Paul Krugman has probably captured as much attention -- and notoriety -- as anyone else in his field. Part of his Making Sen$e of financial news series, Paul Solman speaks with Krugman w...<br><font size="-10"><br /></font><font size="-3">Date Published: 06/18/2012<br>Grades: 9-12<br />Source: <a href='http://www.econedlink.org/' target='_blank'>EconEdLink.org</a></font></p><br><p>-------------------------------------</p><p><b>Lessons:</b></p><br><p><a href='http://www.econedlink.org/e785' target='_blank'>The Unemployment Game</a></p><p>Students will learn about important labor market statistics that are frequently discussed in the media. An understanding of the unemployment rate and labor force participation rate will be developed through participation in an interactive simulation game.<br><font size="-10"><br /></font><font size="-3">Date Published: 06/08/2009<br />Grades: 9-12<br />Source: <a href='http://www.econedlink.org/' target='_blank'>EconEdLink.org</a></font></p><br><p><a href='http://www.econedlink.org/e27' target='_blank'>U.S. Senate Rejects Minimum Wage Bill</a></p><p>In 1998, the Senate voted to reject a $1 increase in the federal hourly minimum wage. The vote fell along party lines, with Democrats voting in favor of the proposal and Republicans voting against it. Interview your classmates to find arguments for and against.<br><font size="-10"><br /></font><font size="-3">Date Published: 09/28/1998<br />Grades: 9-12<br />Source: <a href='http://www.econedlink.org/' target='_blank'>EconEdLink.org</a></font></p><br><p><a href='http://www.econedlink.org/e850' target='_blank'>Phillips Curve</a></p><p>This lesson explores the relationship of unemployment to inflation in the 1960s and after. Students will discover the short-run trade-off between inflation and unemployment when unemployment is less than its natural rate. Students will learn how wage setters formed adaptive expectations about future inflation and included these in their wage demands. At the conclusion of this lesson, students will be able to graph and analyze the effects of a policy to hold unemployment below its natural rate. The goal is for students to see the link between the Phillips Curve and the short-run aggregate supply curve.<br><font size="-10"><br /></font><font size="-3">Date Published: 01/07/2010<br />Grades: 9-12<br />Source: <a href='http://www.econedlink.org/' target='_blank'>EconEdLink.org</a></font></p><br><p><a href='http://www.econedlink.org/e742' target='_blank'>Jobs: Who Needs 'Em?</a></p><p>In this lesson, students will look at the importance having some kind of job. At early ages they sometimes get the idea that money grows on trees and they should get anything that they want. This lesson will look at the consequences of having a job, having a non-paying job (like a stay at home mom), and having no job (whether it's intentional or not). By the time they finish this lesson, they will have a better understanding of the economic impact of good, hard work.<br><font size="-10"><br /></font><font size="-3">Date Published: 05/08/2008<br />Grades: 3-5<br />Source: <a href='http://www.econedlink.org/' target='_blank'>EconEdLink.org</a></font></p><br><p><a href='http://www.econedlink.org/e474' target='_blank'>Who Is Working?</a></p><p>This lesson teaches students what economists mean when they talk about people who are employed, unemployed, and not in the labor force. It discusses the Current Population Survey and asks students to pose as government survey workers to determine the employment status of 10 people given in the lesson. Students also create a bar graph and a line graph to create a picture of the information they pretend to collect.<br><font size="-10"><br /></font><font size="-3">Date Published: 07/23/2003<br />Grades: 6-8<br />Source: <a href='http://www.econedlink.org/' target='_blank'>EconEdLink.org</a></font></p><br>]]></resources>
<related>
<concept>63</concept>
<concept>12</concept>
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<concept>45</concept>
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<quiz>1</quiz>
</concept>
<concept>
<id>69</id>
<name>Entrepreneurs</name>
<category>2</category>
<definition><![CDATA[<p><b><a href="event:function=defineGlossaryTerm,Entrepreneur">Entrepreneurs</a></b> are willing to <a href="event:function=defineGlossaryTerm,Risk">risk</a> their own <a href="event:function=defineGlossaryTerm,Resources">resources</a> in order to sell them for financial gain or <a href="event:function=defineGlossaryTerm,Profit">profits</a>. Entrepreneurs are successful when they provide <a href="event:function=defineGlossaryTerm,Consumers">consumers</a> with <a href="event:function=defineGlossaryTerm,Goods">goods</a> and <a href="event:function=defineGlossaryTerm,Services">services</a> that consumers highly value. Financially successful entrepreneurs have some common characteristics. First, they are willing to assume risk, and high risk can lead to high rewards. Second, entrepreneurs have unique skills that help them develop new <a href="event:function=defineGlossaryTerm,Product">products</a> or new cost-cutting <a href="event:function=defineGlossaryTerm,Production">production</a> methods or new ways to serve consumers. Third, many entrepreneurs also have the discipline to work long and difficult hours to achieve their <a href="event:function=defineGlossaryTerm,Goal">goals</a>. These same entrepreneurial characteristics can help anyone to be successful even one who doesn't start a <a href="event:function=defineGlossaryTerm,Business">business</a>. If you want to earn more <a href="event:function=defineGlossaryTerm,Income">income</a>, develop valuable skills and use them in ways that are highly valued by others. </p>]]></definition>
<lessons><![CDATA[<p>Below are <b>featured</b> lessons for teaching Entrepreneurs.</p><br><p class="tipHeading">High School Lessons</p><p>--------------------------------------------------------------------</p><p><a href="event:function=viewLesson,68291"><b>Theme 2: Lesson 5 - Making Your Own Job</b></a><br><a href="event:function=viewPublication,138">Financial Fitness for Life: 9-12 - Teacher Guide</a></p><br><p class="smaller_text">Not everyone works for someone else. Some people make jobs for themselves. They are called entrepreneurs. This lesson focuses on entrepreneurs. It identifies characteristics of entrepreneurs, compares advantages and disadvantages of becoming an en...</p><br><p>--------------------------------------------------------------------</p><p><a href="event:function=viewLesson,67750"><b>Lesson 24: Industrial Entrepreneurs or Robber Barons?</b></a><br><a href="event:function=viewPublication,105">Focus: Understanding Economics in U.S. History</a></p><br><p class="smaller_text">This lesson focuses on a group of nineteenth-century industrial entrepreneurs described in many history books as Robber Barons. It calls upon students to analyze the activities of these entrepreneurs in order to draw conclusions about the innovati...</p><br><p>--------------------------------------------------------------------</p><p><a href="event:function=viewLesson,67738"><b>Lesson 12: Francis Cabot Lowell and the New England Textile Industry</b></a><br><a href="event:function=viewPublication,105">Focus: Understanding Economics in U.S. History</a></p><br><p class="smaller_text">The teacher presents information about the characteristics of entrepreneurs. The students read a passage about Francis Cabot Lowell and the New England textile industry and identify the entrepreneurial activities exemplified by Lowell's founding o...</p><br><p>--------------------------------------------------------------------</p><p><a href="event:function=viewLesson,62514"><b>Lesson 9- The Industrial Revolution</b></a><br><a href="event:function=viewPublication,70">World History: Focus on Economics</a></p><br><p class="smaller_text">Students read an introduction to the economic aspects of the Industrial Revolution, then work in small groups to develop lists of factors that encourage innovation. After class discussion of the lists, students analyze descriptions of the politic...</p><br><p>--------------------------------------------------------------------</p><p><a href="event:function=viewLesson,62612"><b>Lesson 29: The Innovative Process: How Entrepreneurs Develop New Ideas</b></a><br><a href="event:function=viewPublication,60">Entrepreneurship in the U.S. Economy: Teacher Resource Manual</a></p><br><p class="smaller_text">In this lesson, students will identify steps in the innovative process, which organizes and encourages the development and use of new ideas; apply steps in the innovative process to find creative ways of resolving a specific problem or of taking a...</p><br><p>--------------------------------------------------------------------</p><p><a href="event:function=viewLesson,62601"><b>Lesson 18: Entrepreneurs Choose Different Types of Business Organization</b></a><br><a href="event:function=viewPublication,60">Entrepreneurship in the U.S. Economy: Teacher Resource Manual</a></p><br><p class="smaller_text">In this lesson, students will identify characteristics of the following forms of business organization: sole proprietorship, partnership, and corporation; compare forms of business organization to decide which is most appropriate for a given set o...</p><br><p>--------------------------------------------------------------------</p><p><a href="event:function=viewLesson,62584"><b>Lesson 1: What Is an Entrepreneur?</b></a><br><a href="event:function=viewPublication,60">Entrepreneurship in the U.S. Economy: Teacher Resource Manual</a></p><br><p class="smaller_text">In this lesson, students will define entrepreneurship; describe entrepreneurial attributes demonstrated by successful entrepreneurs; and, compare personal attributes with attributes generally common to successful entrepreneurs.</p><br> <p>--------------------------------------------------------------------</p><p><a href="event:function=viewLesson,772"><b><font color="#CC6666">Online Lesson:</font> Marketplace: MIT Business Plan Competition</b></a><br><a href='http://www.econedlink.org/' target='_blank'>EconEdLink.org</a></p><br><p class="smaller_text">The Sloan School of Business at Massachusetts Institute of Technology (MIT) hosts a yearly competition for the best business plan. It's not just your average science fair project. Many entrepreneurs have used the money they won in the MIT competit...</p><br><p>--------------------------------------------------------------------</p><p><a href="event:function=viewLesson,764"><b><font color="#CC6666">Online Lesson:</font> Marketplace: Economy of Architecture</b></a><br><a href='http://www.econedlink.org/' target='_blank'>EconEdLink.org</a></p><br><p class="smaller_text">In March 2004, Andrew Haeg reported that in this age of globalization, great cultural centers have become essential to a city's economic survival. The arts can even put cities like Milwaukee on the map.</p><br><p>--------------------------------------------------------------------</p><p><a href="event:function=viewLesson,668"><b><font color="#CC6666">Online Lesson:</font> Henry Ford and the Model T: A Case Study in Productivity (Part 1)</b></a><br><a href='http://www.econedlink.org/' target='_blank'>EconEdLink.org</a></p><br><p class="smaller_text">When Henry Ford announced he was going to produce an automobile that would be affordable to the masses, he probably did not realize what a great impact his achievement would have on life in the United States and, eventually, the world. Ford’...</p><br><p>--------------------------------------------------------------------</p><p><a href="event:function=viewLesson,264"><b><font color="#CC6666">Online Lesson:</font> The Entepreneur in you?</b></a><br><a href='http://www.econedlink.org/' target='_blank'>EconEdLink.org</a></p><br><p class="smaller_text">Throughout this lesson students take note of the role of risk and incentives as factors found in all entrepreneurial pursuits. They will analyze, compare and evaluate personal characteristics of entrepreneurs. They will also develop a greater...</p><br><p>--------------------------------------------------------------------</p><p><a href="event:function=viewLesson,533"><b><font color="#CC6666">Online Lesson:</font> Business Ownership: How Sweet It Can Be!</b></a><br><a href='http://www.econedlink.org/' target='_blank'>EconEdLink.org</a></p><br><p class="smaller_text">In this lesson, students research the three basic types of business organization: sole proprietorships, partnerships, and corporations. Considering the advantages and disadvantages of each, they function as consultants offering advice on whic...</p><br><p class="tipHeading">Middle School Lessons</p><p>--------------------------------------------------------------------</p><p><a href="event:function=viewLesson,67875"><b>Lesson 6 - My Problem, My Solution</b></a><br><a href="event:function=viewPublication,115">Focus: Economics - Grades 3-5</a></p><br><p class="smaller_text">Successful entrepreneurs recognize opportunities to solve problems. In this lesson, the students look at products that were invented to solve problems. They examine a product used to raise beds and thing about why this product was invented. Div...</p><br><p>--------------------------------------------------------------------</p><p><a href="event:function=viewLesson,62631"><b>Lesson 1 - The Path Not Taken</b></a><br><a href="event:function=viewPublication,49">Focus: Middle School Economics</a></p><br><p class="smaller_text">Students create a decision/opportunity cost flowchart for Madam C. J. Walker.</p><br> <p>--------------------------------------------------------------------</p><p><a href="event:function=viewLesson,853"><b><font color="#CC6666">Online Lesson:</font> The Ice Cream Stand</b></a><br><a href='http://www.econedlink.org/' target='_blank'>EconEdLink.org</a></p><br><p class="smaller_text">Students will learn about supply, demand, price, competition, and entrepreneurial skills in this lesson. They will put what they learned into action by creating an ice cream stand, to complete with other stands in the classroom.</p><br><p>--------------------------------------------------------------------</p><p><a href="event:function=viewLesson,476"><b><font color="#CC6666">Online Lesson:</font> I Can Be an Entrepreneur</b></a><br><a href='http://www.econedlink.org/' target='_blank'>EconEdLink.org</a></p><br><p class="smaller_text">Learners are given advice on how they can earn extra money by becoming an entrepreneur. After investigating several web pages that offer examples of what other people their age have done to earn money, students identify three money-making ideas fo...</p><br><p>--------------------------------------------------------------------</p><p><a href="event:function=viewLesson,376"><b><font color="#CC6666">Online Lesson:</font> All In Business</b></a><br><a href='http://www.econedlink.org/' target='_blank'>EconEdLink.org</a></p><br><p class="smaller_text">This is a lessons on entrepreneurship. It can be used to help students understand what innovations are, and what it takes to get an idea off the ground. This lesson will take students through the process of calculating risks associated with ...</p><br><p class="tipHeading">Elementary Lessons</p><p>--------------------------------------------------------------------</p><p><a href="event:function=viewLesson,68198"><b>Theme 1: Lesson 2 - Working for Income</b></a><br><a href="event:function=viewPublication,131">Financial Fitness for Life: K-2 - Teacher Guide</a></p><br><p class="smaller_text">The students discuss goods and services that satisfy people's wants, and they construct a spyglass to help them identify goods and services at school. They also construct Busy Town, a model business community. Using a puzzle, they are introduced t...</p><br><p>--------------------------------------------------------------------</p><p><a href="event:function=viewLesson,68165"><b>Theme 1: Lesson 2 - Urban Mouse and Rural Mouse</b></a><br><a href="event:function=viewPublication,134">Financial Fitness for Life: Grades 3-5 - Teacher Guide</a></p><br><p class="smaller_text">The students use an index of businesses for a fictional community to learn why people create businesses to provide goods and services in their communities. They read an adaptation of the fable 'City Mouse, Country Mouse,' here titled 'Urban Mouse ...</p><br><p>--------------------------------------------------------------------</p><p><a href="event:function=viewLesson,67942"><b>Lesson 21: Lunch Money</b></a><br><a href="event:function=viewPublication,116">Teaching Economics Using Children's Literature</a></p><br><p class="smaller_text">Greg is a sixth grader with a love for money. He had his first lemonade stand in second grade and is always looking for new ways to make money. Greg recently discovered that most students bring extra money to school each day, so he has decided it'...</p><br><p>--------------------------------------------------------------------</p><p><a href="event:function=viewLesson,67925"><b>Lesson 4: Arthur's Pet Business</b></a><br><a href="event:function=viewPublication,116">Teaching Economics Using Children's Literature</a></p><br><p class="smaller_text">To prove he is responsible enough to own a pet and to repay a debt of money to his sister, Arthur decides to start a pet business - providing pet care service to community members. He advertises by putting up signs around the neighborhood. Busin...</p><br><p>--------------------------------------------------------------------</p><p><a href="event:function=viewLesson,67118"><b>Lesson 6: Bookmark Profit</b></a><br><a href="event:function=viewPublication,102">Mathematics & Economics: Connections for Life - 3-5</a></p><br><p class="smaller_text">This lesson focuses on profit (economics) and basic operations (mathematics). Working in small groups, the students act as companies and produce bookmarks. They decide which resources to purchase to produce their bookmarks. They calculate their co...</p><br><p>--------------------------------------------------------------------</p><p><a href="event:function=viewLesson,62628"><b>Lesson 4: Entrepreneurs Exist Everywhere</b></a><br><a href="event:function=viewPublication,76">Resources A to Z</a></p><br><p class="smaller_text">Students consider how many goods and services were created to make their lives better. This lesson examines the role of inventions, innovations, and entrepreneurs in our economy. Working in groups, students engage in problem solving and think ab...</p><br> <p>--------------------------------------------------------------------</p><p><a href="event:function=viewLesson,330"><b><font color="#CC6666">Online Lesson:</font> Economic Spotter: Inventors and Entrepreneurs in the Industrial Age</b></a><br><a href='http://www.econedlink.org/' target='_blank'>EconEdLink.org</a></p><br><p class="smaller_text">The Industrial Age has also been called the Age of Edison. Edison patented more than 1000 inventions and gave rise to three industries: electric utilities, phonograph and record companies, and the film industry. This lesson will help students...</p><br><p>--------------------------------------------------------------------</p><p><a href="event:function=viewLesson,374"><b><font color="#CC6666">Online Lesson:</font> Ben & Jerry's Flavor Graveyard</b></a><br><a href='http://www.econedlink.org/' target='_blank'>EconEdLink.org</a></p><br><p class="smaller_text">Ben & Jerry are producers of ice cream. Even if they produce ice cream for the entire nation, they still must make choices on which flavor to produce! Scarce resources force them to make a choice!</p><br><p>--------------------------------------------------------------------</p><p><a href="event:function=viewLesson,167"><b><font color="#CC6666">Online Lesson:</font> Eureka!</b></a><br><a href='http://www.econedlink.org/' target='_blank'>EconEdLink.org</a></p><br><p class="smaller_text">Take a look at how inventions, such as plastic, have changed our lives and how they are changing the future of living in space. Students explore the concept of invention and innovation by studying the use of plastics. Various uses of plastics are ...</p><br><p>--------------------------------------------------------------------</p><p><a href="event:function=viewLesson,155"><b><font color="#CC6666">Online Lesson:</font> An Entreduction</b></a><br><a href='http://www.econedlink.org/' target='_blank'>EconEdLink.org</a></p><br><p class="smaller_text">This lesson illustrates the differences between inventions and innovations. It discusses what entrepreneurs are and their role with inventions and innovations.</p><br>]]></lessons>
<tips><![CDATA[<p class="tipHeading">Tip #1</p><p>Often students think that inventors are entrepreneurs--sometimes they are and sometimes they are not. It is important to note that entrepreneurs take the risks required to bring a product to market. An inventor can have a product in his or her basement but will become an entrepreneur only upon moving the product from the basement into the marketplace. Have the students read about inventors who were entrepreneurs (e.g., Jim Henson, Jan Matzliger, Thomas Edison, Steve Jobs, Mark Zuckerberg).</p><br><p class="tipHeading">Tip #2</p><p>Students who want to be financially successful do not have to be entrepreneurs but should think entrepreneurially. Entrepreneurs are successful because they provide others with things they value highly. Students who focus on how to make their labor more valuable to future employers will be more financially successful just like successful entrepreneurs. This entrepreneurial way of thinking is most important when making decisions about education and training.</p><br>]]></tips>
<resources><![CDATA[<p><b>Interactive tools:</b><br /></p><p><font color="#CC6666">Video</font> <a href='http://www.econedlink.org/i212' target='_blank'>Entrepreneurs</a></p><p>This video teaches the concept of Entrepreneurs. Entrepreneurs are willing to risk their own resources in order to sell them for financial gain or profits. They are successful when they provide consumers with goods and services that consumers high...<br><font size="-10"><br /></font><font size="-3">Date Published: 07/12/2012<br>Grades: 3-5, 6-8, 9-12<br />Source: <a href='http://www.econedlink.org/' target='_blank'>EconEdLink.org</a></font></p><br><p><font color="#CC6666">Video</font> <a href='http://www.econedlink.org/i245' target='_blank'>Making Sen$e with Paul Solman: Downloadable Gun Parts, Personalized Bioterror: the Downside of Innovation</a></p><p>Through innovation and technology, California think tank Singularity University aims to push the frontiers of progress. But what happens when high-tech advances end up in the wrong hands? Economics correspondent Paul Solman raises some disturbing ...<br><font size="-10"><br /></font><font size="-3">Date Published: 04/26/2012<br>Grades: 9-12<br />Source: <a href='http://www.econedlink.org/' target='_blank'>EconEdLink.org</a></font></p><br><p><font color="#CC6666">Video</font> <a href='http://www.econedlink.org/i244' target='_blank'>Making Sen$e with Paul Solman: Tech's Next Feats? Maybe On-Demand Kidneys, Robot Sex, Cheap Solar, Lab Meat</a></p><p>Optimists at Silicon Valley think tank Singularity University are pushing the frontiers of human progress through innovation and emerging technologies, looking to greater longevity and better health. As part of his series on Making $ense of financ...<br><font size="-10"><br /></font><font size="-3">Date Published: 04/20/2012<br>Grades: 9-12<br />Source: <a href='http://www.econedlink.org/' target='_blank'>EconEdLink.org</a></font></p><br><p><font color="#CC6666">Video</font> <a href='http://www.econedlink.org/i265' target='_blank'>Never Too Young: Personal Finance for Young Learners</a></p><p>This program was developed in response to a growing interest in teaching students about personal finance through settings outside of the traditional school day. The program teaches young students about financial choices, cost‐benefit analysis fo...<br><font size="-10"><br /></font><font size="-3">Date Published: 10/19/2012<br>Grades: K-2, 3-5<br />Source: <a href='http://www.econedlink.org/' target='_blank'>EconEdLink.org</a></font></p><br><p><font color="#CC6666">Video</font> <a href='http://www.econedlink.org/i191' target='_blank'>Productive Resources</a></p><p>This video teaches the concept of Productive Resources. Productive resources are used to produce goods and services and are classified into four categories: land, labor, capital, and entrepreneurship.<br><font size="-10"><br /></font><font size="-3">Date Published: 07/12/2012<br>Grades: 3-5, 6-8, 9-12<br />Source: <a href='http://www.econedlink.org/' target='_blank'>EconEdLink.org</a></font></p><br><p>-------------------------------------</p><p><b>Lessons:</b></p><br><p><a href='http://www.econedlink.org/e1074' target='_blank'>Spotlighting Entrepreneurs: A Technology "iCon"</a></p><p>What better way to address Common Core standards in Reading Informational Text than by meeting a gentleman that changed the world of technology!<br><font size="-10"><br /></font><font size="-3">Date Published: 03/11/2013<br />Grades: 3-5<br />Source: <a href='http://www.econedlink.org/' target='_blank'>EconEdLink.org</a></font></p><br><p><a href='http://www.econedlink.org/e1069' target='_blank'>Spotlighting Entrepreneurs: The Sweet Success of Milton Hershey</a></p><p>Looking for a lesson that ties Common Core Standards in Reading Informational Text with Economics? This lesson spotlights the life of Milton S. Hershey and allows students to learn about the risks and rewards of entrepreneurship through a biographical sketch of one who experienced many bitter disappointments and sweet successes.<br><font size="-10"><br /></font><font size="-3">Date Published: 07/23/2012<br />Grades: 3-5<br />Source: <a href='http://www.econedlink.org/' target='_blank'>EconEdLink.org</a></font></p><br><p><a href='http://www.econedlink.org/e727' target='_blank'>Transportation: They Say We Had a Revolution (Part 3)</a></p><p>Advancements in transportation have played a key role in the growth of our nation. U.S. government policies have also had a considerable impact on the development of transport as we know it today. In this series of three lessons, the students examine transportation and its impact on our nation (and vice versa) since the United States declared its independence in 1776. Lesson 1 focuses on improvements in transportation during the 19th century, particularly the development of a national rail system, to show how invention, innovation and infrastructure encouraged western expansion and economic growth. Lesson 2 moves on to the 20th century focusing on the development of auto transport and aviation. The impact on communities and world trade, for both good and bad,is examined. Lesson 3 calls upon the students to create a class timeline of transportation milestones; the timeline will help the students more clearly understand the factors, especially the economic incentives, that have played a key role in what has been called the "Transportation Revolution." While these three lessons will ideally be used together as a set, teachers may choose to use one or two of them, selectively, to focus, for example, on the 19th or the 20th century. If you would like your students to study the economics of transportation in more depth, consider following up with the EconEdLink lesson,An Economic Mystery: What Happened to Railroads?<br><font size="-10"><br /></font><font size="-3">Date Published: 02/05/2008<br />Grades: 6-8, 9-12<br />Source: <a href='http://www.econedlink.org/' target='_blank'>EconEdLink.org</a></font></p><br><p><a href='http://www.econedlink.org/e725' target='_blank'>Transportation: They Say We Had a Revolution (Part 2)</a></p><p>Advancements in transportation have played a key role in the growth of our nation. U.S.government policies have also had a considerable impact on the development of transport as we know it today. In this series of three lessons, the students examine the advancements in automobiles, roads, airlines and airports.<br><font size="-10"><br /></font><font size="-3">Date Published: 06/03/2009<br />Grades: 6-8, 9-12<br />Source: <a href='http://www.econedlink.org/' target='_blank'>EconEdLink.org</a></font></p><br><p><a href='http://www.econedlink.org/e719' target='_blank'>Transportation: They Say We Had a Revolution (Part 1)</a></p><p>Advancements in transportation have played a key role in the growth of our nation. U.S.government policies have also had a considerable impact on the development of transport as we know it today. In this series of three lessons,the students examine transportation and its impact on our nation (and vice versa) since the United States declared its independence in 1776. Lesson 1 focuses on improvements in transportation during the 19th century, particularly the development of a national rail system, to show how invention, innovation and infrastructure encouraged western expansion and economic growth. Lesson 2 moves on to the 20thcentury focusing on the development of auto transport and aviation. The impact on communities and world trade, for both good and bad,is examined. Lesson 3 calls upon the students to create a class time line of transportation milestones; the time line will help the students more clearly understand the factors, especially the economic incentives,that have played a key role in what has been called the 'Transportation Revolution.' While these three lessons will ideally be used together as a set, teachers may choose to use one or two of them, selectively, to focus, for example, on the 19th or the 20th century. If you would like your students to study the economics of transportation in more depth, consider following up with the EconEdLink lesson, An Economic Mystery: What Happened to Railroads?<br><font size="-10"><br /></font><font size="-3">Date Published: 01/30/2008<br />Grades: 6-8, 9-12<br />Source: <a href='http://www.econedlink.org/' target='_blank'>EconEdLink.org</a></font></p><br>]]></resources>
<related>
<concept>67</concept>
<concept>45</concept>
<concept>70</concept>
</related>
<quiz>1</quiz>
</concept>
<concept>
<id>65</id>
<name>Financial Markets</name>
<category>4</category>
<definition><![CDATA[<p><b>Financial markets</b> are those <a href="event:function=defineGlossaryTerm,Markets">markets</a> that exist for buying and selling financial <a href="event:function=defineGlossaryTerm,Asset">assets</a>. The most important financial assets for individual investors are <a href="event:function=defineGlossaryTerm,Bond">bonds</a>, <a href="event:function=defineGlossaryTerm,Stock">stocks</a> and <a href="event:function=defineGlossaryTerm,Mutual Fund">mutual funds</a>.</p> <br><p>A bond is issued by a <a href="event:function=defineGlossaryTerm,Corporation">corporation</a> or government as a way of <a href="event:function=defineGlossaryTerm,Borrow">borrowing</a> money. An individual who purchases a bond gives <a href="event:function=defineGlossaryTerm,Money">money</a> to the corporation or government that issued the bond, and in return, receives repayment of the money with <a href="event:function=defineGlossaryTerm,Interest">interest</a> over time. Short-term bonds are commonly repaid over a few months or a few years; long-term bonds are repaid over decades. Many bonds promise a fixed rate of interest. Investors in long-term bonds must be concerned that if <a href="event:function=defineGlossaryTerm,Inflation">inflation</a> is unexpectedly high or nominal interest rates rise, they may be locked into a bond that pays an undesirably low <a href="event:function=defineGlossaryTerm,Rate of Return">rate of return</a>. </p> <br><p>A stock is a share of ownership in a <a href="event:function=defineGlossaryTerm,Business">business</a>. If a <a href="event:function=defineGlossaryTerm,Firms">firm</a> has 100,000 shares of stock, and you own 1,000 shares, then you own 1 percent of the company. Owners of stock receive a <a href="event:function=defineGlossaryTerm,Return">return</a> in two ways. The firm may pay <a href="event:function=defineGlossaryTerm,Dividend">dividends</a> to its shareholders out of the <a href="event:function=defineGlossaryTerm,Profit">profits</a> that it earns. Also, investors may profit by selling their shares of stock for more than they paid for them; this is called a <a href="event:function=defineGlossaryTerm,Capital Gain">capital gain</a>. However, if a company goes bankrupt, the stock is worth nothing. Thus, stocks are a <a href="event:function=defineGlossaryTerm,Risk">riskier</a> investment than many bonds.</p> <br><p>Many individual investors want to <a href="event:function=defineGlossaryTerm,Diversify">diversify</a>, that is, own a wide range of stocks and/or bonds from different firms and different levels of government, so that they don't have to worry too much about what happens with any individual firm. A mutual fund is an investment company that raises money from investors; purchases a range of stocks, bonds and other financial investments; and pays a return to shareholders according to the overall return of the entire fund. A mutual fund that seeks to mimic the average performance of the <a href="event:function=defineGlossaryTerm,Stock Market">stock market</a> as a whole is called an <a href="event:function=defineGlossaryTerm,Index Fund">index fund</a>. However, a mutual fund may focus on stocks or bonds from a particular industry or particular country or those that the mutual fund manager believes will perform well in the future. For many individual investors, it is much easier to diversify by using one or a few mutual funds, than by purchasing dozens or hundreds of individual stocks and bonds. </p>]]></definition>
<lessons><![CDATA[<p>Below are <b>featured</b> lessons for teaching Financial Markets.</p><br><p class="tipHeading">High School Lessons</p><p>--------------------------------------------------------------------</p><p><a href="event:function=viewLesson,68111"><b>Lesson 8 - Understanding Financial Markets, 2007-2009</b></a><br><a href="event:function=viewPublication,140">Teaching Financial Crises</a></p><br><p class="smaller_text">This lesson pulls together the events in financial markets from 2007 to 2009 by examining the persons and financial institutions that played key roles in the crisis, including why it occurred, who was affected, and the aftermath. How better to und...</p><br><p>--------------------------------------------------------------------</p><p><a href="event:function=viewLesson,68110"><b>Lesson 7 - The Instruments and Institutions of Modern Financial Markets</b></a><br><a href="event:function=viewPublication,140">Teaching Financial Crises</a></p><br><p class="smaller_text">Students work in small groups to make flash cards to display terms commonly used in modern financial markets. Each group of students begins by learning one group of terms. The students pass their flash cards from group to group until everyone has ...</p><br><p>--------------------------------------------------------------------</p><p><a href="event:function=viewLesson,60254"><b>Lesson 4: Financial Systems</b></a><br><a href="event:function=viewPublication,39">Focus: Institutions and Markets</a></p><br><p class="smaller_text">Students participate in a brief simulation to demonstrate the important role financial intermediaries play in promoting investment and economic growth in market economies. Through direct instruction, students learn some specialized terms related ...</p><br><p>--------------------------------------------------------------------</p><p><a href="event:function=viewLesson,333"><b><font color="#CC6666">Online Lesson:</font> Here's Your Chance to Make Millions in the Stock Market (Part 1)</b></a><br><a href='http://www.econedlink.org/' target='_blank'>EconEdLink.org</a></p><br><p class="smaller_text">In this lesson students will learn about the impact that efficient markets have on attempting to correctly time the stock market, as well as how investing in stocks should have long-term investment goals. Part I begins by having students read...</p><br><p>--------------------------------------------------------------------</p><p><a href="event:function=viewLesson,292"><b><font color="#CC6666">Online Lesson:</font> NYSE Made Easy</b></a><br><a href='http://www.econedlink.org/' target='_blank'>EconEdLink.org</a></p><br><p class="smaller_text">This lesson will help students to understand the terms that are associated with the New York Stock Exchange. It will also help students to read a stock market report found in any major newspaper or online.</p><br><p class="tipHeading">Middle School Lessons</p><p>--------------------------------------------------------------------</p><p><a href="event:function=viewLesson,68245"><b>Theme 4: Lesson 14 - Stocks and Mutual Funds</b></a><br><a href="event:function=viewPublication,136">Financial Fitness for Life: Grades 6-8 - Teacher Guide</a></p><br><p class="smaller_text">The students learn about stocks: how stocks are issued, different levels of risk, and differences in possible returns. In studying risk, the students also learn about mutual funds and diversification.</p><br><p>--------------------------------------------------------------------</p><p><a href="event:function=viewLesson,62645"><b>Lesson 15 - Savers And Borrowers</b></a><br><a href="event:function=viewPublication,49">Focus: Middle School Economics</a></p><br><p class="smaller_text">In this lesson, students encounter difficulties in lending and borrowing. They identify financial institutions as effective intermediaries in this process. In closure they discuss the role credit can have on the growth of a community.</p><br> <p>--------------------------------------------------------------------</p><p><a href="event:function=viewLesson,918"><b><font color="#CC6666">Online Lesson:</font> How Global is Your Portfolio?</b></a><br><a href='http://www.econedlink.org/' target='_blank'>EconEdLink.org</a></p><br><p class="smaller_text">This engaging lesson challenges students to connect economics and geography as they investigate global companies in the stock market.</p><br><p class="tipHeading">Elementary Lessons</p><p>--------------------------------------------------------------------</p><p><a href="event:function=viewLesson,61983"><b>Lesson 2: Savings Accounts and U.S. Savings Bonds</b></a><br><a href="event:function=viewPublication,101">Learning, Earning and Investing: Grades 4-5 Lessons</a></p><br><p class="smaller_text">People who want to save money can do so in various ways. One method is to use a savings account; another is to buy U. S. Savings Bonds. In this lesson, the students learn about these two methods of saving.</p><br><p>--------------------------------------------------------------------</p><p><a href="event:function=viewLesson,61982"><b>Lesson 1: Stock Prices</b></a><br><a href="event:function=viewPublication,101">Learning, Earning and Investing: Grades 4-5 Lessons</a></p><br><p class="smaller_text">Newspaper and Internet listings of stock prices provide important information for investors. Gathering and understanding information found in the stock listings is an important life skill, and also a useful skill for students participating in stoc...</p><br> ]]></lessons>
<tips><![CDATA[<p class="tipHeading">Tip #1</p><p>Students hear all the time that the market did this or the market did that today. Actually, there is no one market or even one index that represents the market. There are markets for millions of stocks, bonds and other financial instruments. In the words of Warren Buffett, "the stock market doesn't exist. It is only there as a reference to see if anyone is doing anything foolish."</p><br><p class="tipHeading">Tip #2</p><p>The next thing students want to do is "beat the market." Classroom stock market simulations encourage this attitude. Most evidence, however, shows that it is very difficult for investors to beat market averages although constructing a diversified portfolio of index funds or exchange-traded funds can be a science in itself. Mark Twain said, "There are two times in a man's life when he should not speculate: when he can't afford it and when he can."</p><br><p class="tipHeading">Tip #3</p><p>Students often believe that you must be rich to participate in financial markets. Discuss ways that a majority of people participate in the market, including mutual funds, dividend reinvestment plans and employer-sponsored retirement plans.</p><br><p class="tipHeading">Tip #4</p><p>Students often view financial markets as a financial casino with winners and losers. Financial markets are much more important than that and are critical to a successful economy. Financial markets and financial institutions channel savings and financial investments into real investments such as new factories and machines. Financial markets also channel money from savers to borrowers, enabling them to buy homes and other durable goods. Without financial markets, economic growth and prosperity would suffer.</p><br>]]></tips>
<resources><![CDATA[<p><b>Interactive tools:</b><br /></p><p><font color="#CC6666">Video</font> <a href='http://www.econedlink.org/i229' target='_blank'>Financial Markets</a></p><p>This video teaches the concept of Financial Markets. Financial markets are those markets that exist for buying and selling financial assets. The most important financial assets for individual investors are bonds, stocks and mutual funds.<br><font size="-10"><br /></font><font size="-3">Date Published: 07/12/2012<br>Grades: 6-8, 9-12<br />Source: <a href='http://www.econedlink.org/' target='_blank'>EconEdLink.org</a></font></p><br><p><font color="#CC6666">Video</font> <a href='http://www.econedlink.org/i241' target='_blank'>Making Sen$e with Paul Solman: Fictional Thriller Tackles Dangers of High-Frequency Trading CONVERSATION</a></p><p>Part of his series on Making $ense of financial news, economics correspondent Paul Solman spoke with author Robert Harris whose fictional take on Wall Street, "The Fear Index," stresses the dangers of algorithm-driven, high-frequency trading.<br><font size="-10"><br /></font><font size="-3">Date Published: 03/15/2012<br>Grades: 9-12<br />Source: <a href='http://www.econedlink.org/' target='_blank'>EconEdLink.org</a></font></p><br><p><font color="#CC6666">Flash</font> <a href='http://www.econedlink.org/i109' target='_blank'>Gen i Revolution - Mission 8: Stocks</a></p><p>This interactive tool is a part of the online personal finance game, Gen i Revolution. This is one of the fifteen "Missions" available within the online game. This Mission takes about 30 minutes to complete. To sign up to play the game, you'll nee...<br><font size="-10"><br /></font><font size="-3">Date Published: 08/14/2010<br>Grades: 6-8, 9-12<br />Source: <a href='http://www.econedlink.org/' target='_blank'>EconEdLink.org</a></font></p><br><p><font color="#CC6666">Video</font> <a href='http://www.econedlink.org/i243' target='_blank'>Making Sen$e with Paul Solman: Fictional Thriller Tackles Dangers of High-Frequency Trading</a></p><p>Part of his series on Making $ense of financial news, economics correspondent Paul Solman spoke with author Robert Harris whose fictional take on Wall Street, "The Fear Index," stresses the dangers of algorithm-driven, high-frequency trading.<br><font size="-10"><br /></font><font size="-3">Date Published: 03/15/2012<br>Grades: 9-12<br />Source: <a href='http://www.econedlink.org/' target='_blank'>EconEdLink.org</a></font></p><br><p><font color="#CC6666">Video</font> <a href='http://www.econedlink.org/i135' target='_blank'>Learning, Earning and Investing - Lesson 7: What are Mutual Funds?</a></p><p>Included in this interactive are two videos on investing, which are based on one of the lessons from the Learning, Earning and Investing: High School publication. Lesson 7: What are Mutual Funds? teaches students about mutual funds and how to dete...<br><font size="-10"><br /></font><font size="-3">Date Published: 02/16/2011<br>Grades: 9-12<br />Source: <a href='http://www.econedlink.org/' target='_blank'>EconEdLink.org</a></font></p><br><p>-------------------------------------</p><p><b>Lessons:</b></p><br><p><a href='http://www.econedlink.org/e954' target='_blank'>Jokes, Quotations, and Cartoons in Economics</a></p><p>Students will apply their knowledge of economics to the analysis and interpretation of jokes, quotations, and cartoons in economics. Students will watch a Paul Solman video of an interview of Yoram Bauman, the Stand up Economist. Students will use Daryl Cagel's cartoon website, Jokes on the Web, and news media to find economics humor and interpret.<br><font size="-10"><br /></font><font size="-3">Date Published: 07/29/2011<br />Grades: 9-12<br />Source: <a href='http://www.econedlink.org/' target='_blank'>EconEdLink.org</a></font></p><br><p><a href='http://www.econedlink.org/e918' target='_blank'>How Global is Your Portfolio?</a></p><p>This engaging lesson challenges students to connect economics and geography as they investigate global companies in the stock market.<br><font size="-10"><br /></font><font size="-3">Date Published: 12/09/2010<br />Grades: 3-5, 6-8<br />Source: <a href='http://www.econedlink.org/' target='_blank'>EconEdLink.org</a></font></p><br><p><a href='http://www.econedlink.org/e771' target='_blank'>Marketplace: TV Niche News</a></p><p>The students listen to an audio file about brand loyalty and changing demographics as each of these factors affects competition in the news market. They identify major concepts presented in the audio file and record supporting details using an interactive flash note-taker.This lesson is appropriate for use with middle school students.<br><font size="-10"><br /></font><font size="-3">Date Published: 04/03/2009<br />Grades: 6-8, 9-12<br />Source: <a href='http://www.econedlink.org/' target='_blank'>EconEdLink.org</a></font></p><br><p><a href='http://www.econedlink.org/e647' target='_blank'>Believe it or Not?</a></p><p>Advertisements can tell consumers about prices and other information that may help them in the decisions they make about what to buy. But students also should know that ads are slanted by sellers to show a product in the best light. This lesson reveals to students how advertisers use words and images to make goods and services look their best. To protect consumers and make sure that competition among sellers is fair in the marketplace, the federal government requires that factual claims in ads be backed up with proof. Still, it is usually okay for sellers to talk only about the positives and ignore the negatives of what they are selling. Another common trick is to use exaggerated claims called “puffery.” It is up to the consumers to separate factual claims from opinions and exaggerations. This lesson challenges students to create a set of tips that could help consumers to make this distinction. Being able to tell the difference between factual claims and puffery or opinions can help consumers to make smart choices and avoid market disappointments.<br><font size="-10"><br /></font><font size="-3">Date Published: 03/03/2006<br />Grades: 3-5, 6-8<br />Source: <a href='http://www.econedlink.org/' target='_blank'>EconEdLink.org</a></font></p><br><p><a href='http://www.econedlink.org/e645' target='_blank'>Be An Ad Detective</a></p><p>Every day, students are bombarded by advertising. They cannot escape it. But marketers realize that many people—especially young people—are becoming very good at tuning ads out. Businesses thus are becoming more creative in their communication with consumers. In this lesson, the students assume the role of detectives searching for the new places where advertisers are promoting themselves and their products. They also investigate logos, imaginary characters, slogans and jingles—tools used by advertisers to develop brand awareness.
This lesson works well as a follow-up to the EconEdLink lesson Did You Get the Message?<br><font size="-10"><br /></font><font size="-3">Date Published: 03/15/2006<br />Grades: 3-5, 6-8<br />Source: <a href='http://www.econedlink.org/' target='_blank'>EconEdLink.org</a></font></p><br>]]></resources>
<related>
<concept>47</concept>
<concept>60</concept>
<concept>3</concept>
</related>
<quiz>1</quiz>
</concept>
<concept>
<id>63</id>
<name>Fiscal Policy</name>
<category>1</category>
<definition><![CDATA[<p><b>Fiscal policy</b> refers to how government taxing and spending policy can be used to influence the macroeconomy. In the short term, <a href="event:function=defineGlossaryTerm,Fiscal Policy">fiscal policy</a> can be used to reduce the extremes of <a href="event:function=defineGlossaryTerm,Recession">recession</a> and <a href="event:function=defineGlossaryTerm,Inflation">inflation</a>. If the economy is in recession, then an <a href="event:function=defineGlossaryTerm,Expansionary Fiscal Policy">expansionary fiscal policy</a> can increase <a href="event:function=defineGlossaryTerm,Aggregate Demand (AD)">aggregate demand</a> through some combination of tax cuts and/or spending increases. If an economy is suffering inflation, then a <a href="event:function=defineGlossaryTerm,Contractionary Fiscal Policy">contractionary fiscal policy</a> can reduce aggregate demand through some combination of tax increases and/or spending cuts. </p> <br><p>Fiscal policy can be misused and have unintended <a href="event:function=defineGlossaryTerm,Consequence">consequences</a> or side effects. If a highly expansionary policy of tax cuts and/or spending increases is used at a time when the economy is not in a recession, it can increase aggregate demand in a way that leads to inflation. If a contractionary fiscal policy of tax increases and/or spending cuts reduces aggregate demand when an economy is already in or near recession, it can make the recession deeper and longer. An increase in <a href="event:function=defineGlossaryTerm,Taxes">taxes</a> can also affect people's willingness to work, <a href="event:function=defineGlossaryTerm,Save">save</a> and <a href="event:function=defineGlossaryTerm,Investing">invest</a>, and this could cause a decrease in <a href="event:function=defineGlossaryTerm,Economic Growth">economic growth</a>.</p>]]></definition>
<lessons><![CDATA[<p>Below are <b>featured</b> lessons for teaching Fiscal Policy.</p><br><p class="tipHeading">High School Lessons</p><p>--------------------------------------------------------------------</p><p><a href="event:function=viewLesson,68111"><b>Lesson 8 - Understanding Financial Markets, 2007-2009</b></a><br><a href="event:function=viewPublication,140">Teaching Financial Crises</a></p><br><p class="smaller_text">This lesson pulls together the events in financial markets from 2007 to 2009 by examining the persons and financial institutions that played key roles in the crisis, including why it occurred, who was affected, and the aftermath. How better to und...</p><br><p>--------------------------------------------------------------------</p><p><a href="event:function=viewLesson,68031"><b>Lesson 5 - Government Spending</b></a><br><a href="event:function=viewPublication,118">Focus: Understanding Economics in Civics and Government</a></p><br><p class="smaller_text">Through cooperative learning, the students identify patterns and trends in spending by government at the federal, state, and local levels. They analyze potential problems posed by the growth in federal mandatory spending.</p><br><p>--------------------------------------------------------------------</p><p><a href="event:function=viewLesson,67757"><b>Lesson 31: Did the New Deal Help or Harm the Recovery?</b></a><br><a href="event:function=viewPublication,105">Focus: Understanding Economics in U.S. History</a></p><br><p class="smaller_text">Note to the teacher: This lesson is closely tied to the preceding lesson, Whatdunnit? The Great Depression Mystery. The students in groups analyze the New Deal to determine whether individual policies helped end the depression by increasing aggreg...</p><br><p>--------------------------------------------------------------------</p><p><a href="event:function=viewLesson,60260"><b>Lesson 10: Macroeconomic Stabilization Policies and Institutions</b></a><br><a href="event:function=viewPublication,39">Focus: Institutions and Markets</a></p><br><p class="smaller_text">This lesson begins by reviewing the discovery and adoption of Keynesian fiscal policies in the United States and other nations following World War II. Students then participate in several exercises to ascertain their understanding of appropriate ...</p><br><p>--------------------------------------------------------------------</p><p><a href="event:function=viewLesson,15433"><b>Lesson 12 - Fiscal Policy: A Two-Act Play</b></a><br><a href="event:function=viewPublication,2">Economics in Action: 14 Greatest Hits for Teaching High School Economics</a></p><br><p class="smaller_text">Groups of students are given outlines for one of two acts in a play describing either expansionary or contractionary fiscal policy. After the students choose parts and prepare lines for their roles, two groups are chosen to perform the play. Stude...</p><br><p>--------------------------------------------------------------------</p><p><a href="event:function=viewLesson,65720"><b>Lesson 4: Klips And Kupons</b></a><br><a href="event:function=viewPublication,63">Economies in Transition: Command to Market</a></p><br><p class="smaller_text">The students participate in the Klips and Kupons simulation. During the simulation, they discover how a change in the money supply can cause changes in the price level. They formalize this discovery by relating the equation of exchange to their ...</p><br> <p>--------------------------------------------------------------------</p><p><a href="event:function=viewLesson,459"><b><font color="#CC6666">Online Lesson:</font> The Economics of the New Deal</b></a><br><a href='http://www.econedlink.org/' target='_blank'>EconEdLink.org</a></p><br><p class="smaller_text">The stock-market crash of 1929 is generally seen as the start of The Great Depression, the worst economic downturn in the history of the United States. The Depression had devastating effects on the country. But it also served as a wake-up call for...</p><br><p>--------------------------------------------------------------------</p><p><a href="event:function=viewLesson,190"><b><font color="#CC6666">Online Lesson:</font> The Role of Government: The Federal Government and Fiscal Policy</b></a><br><a href='http://www.econedlink.org/' target='_blank'>EconEdLink.org</a></p><br><p class="smaller_text">Students will visit “A Citizen’s Guide to the Federal Budget,” and use the federal government web site to obtain information which will help them understand basic information about the budget of the United States Government f...</p><br><p>--------------------------------------------------------------------</p><p><a href="event:function=viewLesson,29"><b><font color="#CC6666">Online Lesson:</font> Fed Orders Interest Rate Cut</b></a><br><a href='http://www.econedlink.org/' target='_blank'>EconEdLink.org</a></p><br><p class="smaller_text">On October 15, 1998 Alan Greenspan and the Board of Governors, in a surprise move ordered short-term interest rates cut by 0.25%. What prompted the Fed to take this action? What impact will the rate change have on the economy? Analyze the art...</p><br>]]></lessons>
<tips><![CDATA[<p class="tipHeading">Tip #1</p><p>One aspect of fiscal policy is the expenditure multiplier in which an increase or decrease in government spending, investment spending or autonomous consumer spending has a multiplied effect on GDP. This makes fiscal policy more powerful. An analogy to explain this abstract concept would be to fill a pot with popcorn and show how the popcorn expands when popped. The unpopped corn could represent an increase in investment while the popped corn represents a larger increase in GDP. The heat represents the fiscal policy that increases investment.</p><br><p class="tipHeading">Tip #2</p><p>To show the effects of fiscal policy, have the students perform a role-play activity. Start with the government increasing spending or decreasing taxes (expansionary fiscal policy). Have the students play the roles of the President, a consumer, a worker, a business owner and a salesperson. Each person must explain how the policy affects him or her and why. Conduct the activity again for contractionary fiscal policy.</p><br>]]></tips>
<resources><![CDATA[<p><b>Interactive tools:</b><br /></p><p><font color="#CC6666">Video</font> <a href='http://www.econedlink.org/i276' target='_blank'>Making Sen$e with Paul Solman: 'Tis the Season, But Should We Save or Spend? A Holiday Money Conundrum</a></p><p>Is saving money during the holidays smart or Scrooge-ish? Is shopping a way of forging social bonds and expressing your freedom or is it giving in to crass commercialism? Following the lessons of some "economist Christmas carols," economics corres...<br><font size="-10"><br /></font><font size="-3">Date Published: 12/20/2012<br>Grades: 9-12<br />Source: <a href='http://www.econedlink.org/' target='_blank'>EconEdLink.org</a></font></p><br><p><font color="#CC6666">Video</font> <a href='http://www.econedlink.org/i273' target='_blank'>Making Sen$e with Paul Solman: America's Historical Struggle With Debt and the Role of Federal Government</a></p><p>Between paying now or paying later, Americans have just about always preferred debt to taxes. Paul Solman talks to Simon Johnson of the MIT Sloan School of Management about his new book "White House Burning," which chronicles the history -- includ...<br><font size="-10"><br /></font><font size="-3">Date Published: 12/12/2012<br>Grades: 9-12<br />Source: <a href='http://www.econedlink.org/' target='_blank'>EconEdLink.org</a></font></p><br><p><font color="#CC6666">Video</font> <a href='http://www.econedlink.org/i259' target='_blank'>Making Sen$e with Paul Solman: Paul Krugman's Solution to Getting Fiscal Stimulus? It Involves Aliens</a></p><p>Amid a tough economy, economist and New York Times columnist Paul Krugman has probably captured as much attention -- and notoriety -- as anyone else in his field. Part of his Making Sen$e of financial news series, Paul Solman speaks with Krugman w...<br><font size="-10"><br /></font><font size="-3">Date Published: 06/18/2012<br>Grades: 9-12<br />Source: <a href='http://www.econedlink.org/' target='_blank'>EconEdLink.org</a></font></p><br><p><font color="#CC6666">Flash</font> <a href='http://www.econedlink.org/i115' target='_blank'>Gen i Revolution - Mission 14: Forecasting the Future</a></p><p>This interactive tool is a part of the online personal finance game, Gen i Revolution. This is one of the fifteen "Missions" available within the online game. This Mission takes about 30 minutes to complete. To sign up to play the game, you'll nee...<br><font size="-10"><br /></font><font size="-3">Date Published: 08/14/2010<br>Grades: 6-8, 9-12<br />Source: <a href='http://www.econedlink.org/' target='_blank'>EconEdLink.org</a></font></p><br><p><font color="#CC6666">Video</font> <a href='http://www.econedlink.org/i18' target='_blank'>Making Sen$e with Paul Solman: German Economic Minister Discusses Strategy</a></p><p>Germany's economic minister speaks with Paul Solman about how Europe's largest economy plans to navigate the global economic downturn.<br><font size="-10"><br /></font><font size="-3">Date Published: 03/19/2009<br>Grades: 9-12<br />Source: <a href='http://www.econedlink.org/' target='_blank'>EconEdLink.org</a></font></p><br><p>-------------------------------------</p><p><b>Lessons:</b></p><br><p><a href='http://www.econedlink.org/e459' target='_blank'>The Economics of the New Deal</a></p><p>The stock-market crash of 1929 is generally seen as the start of The Great Depression, the worst economic downturn in the history of the United States. The Depression had devastating effects on the country. But it also served as a wake-up call for economic reform. Until the Great Depression, the U.S. government had made very few modifications to the nation's economic policies. It left the dealings of the economy and businesses to their own devices. But once the Great Depression began the nation needed help, FAST! The stock market was in shambles. Many banks closed. Farmers fell into bankruptcy and were forced off their land. Twenty-five percent of the work force, or 13 million people, were unemployed in 1932. In 1933, the Roosevelt Administration addressed the problem by making the government a key player in the nation’s economy. Using his New Deal as a force for reform, President Roosevelt created policies, agencies and standards to help alleviate serious problems. The reforms provided America with an economy that has been relatively stable for almost 80 years. Students will be prompted to think about the different programs and policies the New Deal created and how they are relevant to the role of government, and fiscal, and monetary policy, both then and now.<br><font size="-10"><br /></font><font size="-3">Date Published: 06/20/2005<br />Grades: 9-12<br />Source: <a href='http://www.econedlink.org/' target='_blank'>EconEdLink.org</a></font></p><br><p><a href='http://www.econedlink.org/e190' target='_blank'>The Role of Government: The Federal Government and Fiscal Policy</a></p><p>Students will visit “A Citizen’s Guide to the Federal Budget,” and use the federal government web site to obtain information which will help them understand basic information about the budget of the United States Government for the current fiscal year.<br><font size="-10"><br /></font><font size="-3">Date Published: 01/08/2001<br />Grades: 9-12<br />Source: <a href='http://www.econedlink.org/' target='_blank'>EconEdLink.org</a></font></p><br><p><a href='http://www.econedlink.org/e184' target='_blank'>The Role of Government: The National Debt vs. The Deficit</a></p><p>This lesson defines and compares the National Debt with the National Deficit. Students will discover the differences between the two and look at current trends. Students will examine the amount of per-capita debt and be exposed to the reality of the amount the national debt is increasing every day or two despite recent budget surpluses.<br><font size="-10"><br /></font><font size="-3">Date Published: 11/20/2000<br />Grades: 9-12<br />Source: <a href='http://www.econedlink.org/' target='_blank'>EconEdLink.org</a></font></p><br><p><a href='http://www.econedlink.org/e29' target='_blank'>Fed Orders Interest Rate Cut</a></p><p>On October 15, 1998 Alan Greenspan and the Board of Governors, in a surprise move ordered short-term interest rates cut by 0.25%. What prompted the Fed to take this action? What impact will the rate change have on the economy? Analyze the articles below to examine the linkages between actions of the Federal Reserve Bank and economic performance.<br><font size="-10"><br /></font><font size="-3">Date Published: 10/12/1998<br />Grades: 9-12<br />Source: <a href='http://www.econedlink.org/' target='_blank'>EconEdLink.org</a></font></p><br>]]></resources>
<related>
<concept>20</concept>
<concept>62</concept>
<concept>61</concept>
</related>
<quiz>1</quiz>
</concept>
<concept>
<id>36</id>
<name>Foreign Currency Markets/Exchange Rates</name>
<category>3</category>
<definition><![CDATA[<p>The <b>foreign currency market</b> is where one <a href="event:function=defineGlossaryTerm,Currency">currency</a> is exchanged for another. When a <a href="event:function=defineGlossaryTerm,Firms">firm</a> incurs expenses of producing a <a href="event:function=defineGlossaryTerm,Goods">good</a> or <a href="event:function=defineGlossaryTerm,Services">service</a> in one country, but then sells the <a href="event:function=defineGlossaryTerm,Product">product</a> in another country that uses another currency, it must find a way to <a href="event:function=defineGlossaryTerm,Exchange">exchange</a> the currency that it has earned for the currency in which it must pay its expenses. When a financial investor wishes to make an <a href="event:function=defineGlossaryTerm,Investment">investment</a> in a country with another currency, the investor must find a way to convert funds from one currency to another. When a tourist visits a country with another currency, the tourist must convert funds from one currency to another. The international currency market takes place through the <a href="event:function=defineGlossaryTerm,Banking">banking</a> and financial system. <b>Exchange rates</b> are determined by the <a href="event:function=defineGlossaryTerm,Supply">supply</a> of and <a href="event:function=defineGlossaryTerm,Demand">demand</a> for various currencies in the international currency markets.</p> <br><p>An <a href="event:function=defineGlossaryTerm,Exchange Rate">exchange rate</a> is the actual rate of conversion between two currencies. An exchange rate can be expressed in terms of either currency involved. For example, the exchange rate between the U.S. dollar and the euro can be expressed in two equivalent ways: either it is $1.25 per 1 euro, or it is .8 euros per $1. </p> <br><p>When a currency can purchase more of other currencies, then it is said to strengthen or appreciate. When a currency can purchase less of other currencies, then it is said to weaken or depreciate. A stronger or appreciated currency encourages imports and discourages exports; a weaker or depreciated currency discourages <a href="event:function=defineGlossaryTerm,Imports">imports</a> and encourages <a href="event:function=defineGlossaryTerm,Exports">exports</a>.</p>]]></definition>
<lessons><![CDATA[<p>Below are <b>featured</b> lessons for teaching Foreign Currency Markets/Exchange Rates.</p><br><p class="tipHeading">High School Lessons</p><p>--------------------------------------------------------------------</p><p><a href="event:function=viewLesson,15435"><b>Lesson 14 - Exchange Rates: Money Around the World</b></a><br><a href="event:function=viewPublication,2">Economics in Action: 14 Greatest Hits for Teaching High School Economics</a></p><br><p class="smaller_text">Students participate in two auctions to demonstrate the determination of flexible exchange rates and the need for foreign currency to purchase goods from other countries. In the first auction, the students may buy goods produced only in their own ...</p><br><p>--------------------------------------------------------------------</p><p><a href="event:function=viewLesson,65598"><b>Lesson 14: Foreign Exchange Rates</b></a><br><a href="event:function=viewPublication,69">Focus: International Economics</a></p><br><p class="smaller_text">Students are shown various newspaper headlines referring to the value of the dollar in foreign exchange markets. They learn what exchange rates are, and they participate in a simulation where they discover answers to 10 frequently-asked questions...</p><br><p>--------------------------------------------------------------------</p><p><a href="event:function=viewLesson,62477"><b>Lesson 5: Money Around the World</b></a><br><a href="event:function=viewPublication,72">Geography: Focus on Economics</a></p><br><p class="smaller_text">Students participate in one of two class auctions so that they may experience firsthand how prices are determined in different markets.</p><br><p>--------------------------------------------------------------------</p><p><a href="event:function=viewLesson,62455"><b>Lesson 15 - International Economics: Why Should You Care?</b></a><br><a href="event:function=viewPublication,73">Personal Decision Making: Focus on Economics</a></p><br><p class="smaller_text">Students study an exchange rate table found in a local newspaper, and answer questions about exchange rates and their fluctuation. They read a short article on how a depreciation of the dollar could affect American consumers, and answer questions...</p><br> <p>--------------------------------------------------------------------</p><p><a href="event:function=viewLesson,798"><b><font color="#CC6666">Online Lesson:</font> The Family Vacation</b></a><br><a href='http://www.econedlink.org/' target='_blank'>EconEdLink.org</a></p><br><p class="smaller_text">Students will take a surprise trip around the world. As they travel, they will use clues to discover where they are going. They will then figure out how much money they have spent in U.S. dollars, using exchange rates.</p><br><p>--------------------------------------------------------------------</p><p><a href="event:function=viewLesson,629"><b><font color="#CC6666">Online Lesson:</font> Why do we need money? Think about Ebay!</b></a><br><a href='http://www.econedlink.org/' target='_blank'>EconEdLink.org</a></p><br><p class="smaller_text">The students investigate money--its purpose and functions. They complete an exercise, using the online acution site Ebay, to learn why money is critical to an economy.</p><br><p>--------------------------------------------------------------------</p><p><a href="event:function=viewLesson,299"><b><font color="#CC6666">Online Lesson:</font> Marketplace: Let's Go Euro!</b></a><br><a href='http://www.econedlink.org/' target='_blank'>EconEdLink.org</a></p><br><p class="smaller_text">With the start of the new year in 2002, the 12 members of the European Union launched a single currency across their borders, replacing individual country currencies and singling out the Euro as their one shared monetary denomination. Market...</p><br><p>--------------------------------------------------------------------</p><p><a href="event:function=viewLesson,140"><b><font color="#CC6666">Online Lesson:</font> The Economics of Income: Which 'Wood' You Choose?</b></a><br><a href='http://www.econedlink.org/' target='_blank'>EconEdLink.org</a></p><br><p class="smaller_text">A key turning point in a nation's economic development is when it starts to use its resources for long term versus short term purposes. A natural resource example is trees: should people use wood for cooking food or building homes? Simpler societi...</p><br><p>--------------------------------------------------------------------</p><p><a href="event:function=viewLesson,126"><b><font color="#CC6666">Online Lesson:</font> Do You Have a Yen to Go to College?</b></a><br><a href='http://www.econedlink.org/' target='_blank'>EconEdLink.org</a></p><br><p class="smaller_text">Carlos is a senior at local high school. When he graduates, he plans to study computer animation. He has applied to a number of two- year programs, and recently, he received letters of acceptance from four schools, one in the United States and...</p><br><p class="tipHeading">Middle School Lessons</p><p>--------------------------------------------------------------------</p><p><a href="event:function=viewLesson,20773"><b>Lesson 11: Why Are There Foreign Currency Markets?</b></a><br><a href="event:function=viewPublication,9">The Wide World of Trade</a></p><br><p class="smaller_text">After listing some of their own buying and selling activities, students recognize that most people and families are both buyers and sellers who make exchanges in different kinds of markets. The relationship between output markets for goods and se...</p><br><p>--------------------------------------------------------------------</p><p><a href="event:function=viewLesson,15847"><b>Lesson 2 - Vacation Vexation</b></a><br><a href="event:function=viewPublication,3">Mathematics & Economics: Connections for Life - 6-8</a></p><br><p class="smaller_text">In this lesson, the students listen to the story of an American girl who is planning a trip to Mexico. They learn about foreign exchange and compare exchange rates to determine if one currency has appreciated or depreciated against another currenc...</p><br><p>--------------------------------------------------------------------</p><p><a href="event:function=viewLesson,15846"><b>Lesson 1 - Happy Deal?</b></a><br><a href="event:function=viewPublication,3">Mathematics & Economics: Connections for Life - 6-8</a></p><br><p class="smaller_text">In this lesson, the students learn about currencies used in selected countries. They compare the prices of a Big Mac© in different countries and convert the prices into U.S. dollars, using exchange rates. The students determine in which count...</p><br> <p>--------------------------------------------------------------------</p><p><a href="event:function=viewLesson,586"><b><font color="#CC6666">Online Lesson:</font> The Higher you Climb, The More You Pay</b></a><br><a href='http://www.econedlink.org/' target='_blank'>EconEdLink.org</a></p><br><p class="smaller_text">Students will take a "Virtual Tour" of the Eiffel Tower in Paris France and locate the price of a bottle of water at each viewing platform. They will need to problem solve how to pay for admission, buy the water and be able to pay for t...</p><br><p>--------------------------------------------------------------------</p><p><a href="event:function=viewLesson,605"><b><font color="#CC6666">Online Lesson:</font> Agent Pincher: The Case of the UFO</b></a><br><a href='http://www.econedlink.org/' target='_blank'>EconEdLink.org</a></p><br><p class="smaller_text">Agent Pincher: The Case of the UFO--Unfamiliar Foreign Objects. That is what currency from another country may look like. Sometimes when people first try to use money from another country, they feel like they are playing with toy money-it is a di...</p><br><p class="tipHeading">Elementary Lessons</p><p>--------------------------------------------------------------------</p><p><a href="event:function=viewLesson,67124"><b>Lesson 12: Birdly Exchange</b></a><br><a href="event:function=viewPublication,102">Mathematics & Economics: Connections for Life - 3-5</a></p><br><p class="smaller_text">This lesson focuses on barter, money and characteristics of money (economics) and fractions and ratios (mathematics). The students will role-play a bartering activity and participate in trading simulations using feathers and birdles (a form of pap...</p><br> <p>--------------------------------------------------------------------</p><p><a href="event:function=viewLesson,329"><b><font color="#CC6666">Online Lesson:</font> Making Cents out of Centimes</b></a><br><a href='http://www.econedlink.org/' target='_blank'>EconEdLink.org</a></p><br><p class="smaller_text">Students will learn that most countries create their own currency for use as money. In most of Europe that money is now the Euro. Students will discover the use of Euros in this simulation and learn a little about exchanging dollars for Euros.</p><br>]]></lessons>
<tips><![CDATA[<p class="tipHeading">Tip #1</p><p>A good technique to teach the effects of changes in the exchange rate is to make "foreign currency" and "dollars." Have the students "buy" foreign products such as a small candy bar. But first the students must trade dollars for a foreign currency such as pesos. Then appreciate or depreciate the foreign currency and repeat the process to see how much less (more) money they can buy and how that determines how many foreign products they can buy.</p><br><p class="tipHeading">Tip #2</p><p>Students often view a "strong" dollar as "good" and a "weak" dollar as "bad." This is an oversimplification. A strong dollar causes foreign goods to be less expensive in the United States, but it causes U.S. goods to be more expensive in other countries and therefore hurts U.S. businesses that sell to other countries. Instead of explaining exchange rates as good or bad, emphasize how a change in exchange rates may have a significant effect on the flow of trade among nations and on a nation's domestic economy.</p><br><p class="tipHeading">Tip #3</p><p>Ask the students how the appreciation or depreciation of the dollar will affect the cost of a vacation to a foreign country. Appreciation of the dollar will decrease the cost of a foreign trip while depreciation of the dollar will increase the cost of that same foreign trip. First, price the cost of the trip in foreign currency. Then price the trip using two different exchange rates.</p><br>]]></tips>
<resources><![CDATA[<p><b>Interactive tools:</b><br /></p><p><font color="#CC6666">Video</font> <a href='http://www.econedlink.org/i222' target='_blank'>Balance of Trade and Balance of Payments</a></p><p>This video teaches the concepts of Balance of Trade and Balance of Payments. The balance of trade is calculated by subtracting imports from exports. The balance of payments includes payments related to exports and imports of goods; payments relate...<br><font size="-10"><br /></font><font size="-3">Date Published: 07/12/2012<br>Grades: 6-8, 9-12<br />Source: <a href='http://www.econedlink.org/' target='_blank'>EconEdLink.org</a></font></p><br><p><font color="#CC6666">Video</font> <a href='http://www.econedlink.org/i226' target='_blank'>Foreign Currency Markets/Exchange Rates</a></p><p>This video teaches the concepts of Foreign Currency Markets and Exchange Rates. The foreign currency market is where one currency is exchanged for another. An exchange rate is the actual rate of conversion between two currencies.<br><font size="-10"><br /></font><font size="-3">Date Published: 07/12/2012<br>Grades: 3-5, 6-8, 9-12<br />Source: <a href='http://www.econedlink.org/' target='_blank'>EconEdLink.org</a></font></p><br><p><font color="#CC6666">Video</font> <a href='http://www.econedlink.org/i151' target='_blank'>Making Sen$e with Paul Solman: How Currency Choices 'Made in China' Have Big Impact on U.S. Economy</a></p><p>Economics correspondent Paul Solman looks at the ongoing disputes between the U.S. and China over currency valuation and trade.<br><font size="-10"><br /></font><font size="-3">Date Published: 01/18/2011<br>Grades: 9-12<br />Source: <a href='http://www.econedlink.org/' target='_blank'>EconEdLink.org</a></font></p><br><p><font color="#CC6666">Video</font> <a href='http://www.econedlink.org/i56' target='_blank'>Making Sen$e with Paul Solman: Dollar's Weakness Inspires Modern-day Gold Rush</a></p><p>As part of his series on Making Sense of the financial crisis, Paul Solman looks at how the dollar's weakness has spurred a new gold rush.<br><font size="-10"><br /></font><font size="-3">Date Published: 11/25/2009<br>Grades: 9-12<br />Source: <a href='http://www.econedlink.org/' target='_blank'>EconEdLink.org</a></font></p><br><p><font color="#CC6666">Video</font> <a href='http://www.econedlink.org/i156' target='_blank'>Making Sen$e with Paul Solman: How Currency Choices 'Made in China' Have Big Impact on U.S. Economy</a></p><p>Economics correspondent Paul Solman looks at the ongoing dispute between the U.S. and China over currency and trade. Amid its trade deficit with China, the U.S. wants to pressure the Chinese to let their currency, the renminbi, rise in value inste...<br><font size="-10"><br /></font><font size="-3">Date Published: 01/18/2011<br>Grades: 9-12<br />Source: <a href='http://www.econedlink.org/' target='_blank'>EconEdLink.org</a></font></p><br><p>-------------------------------------</p><p><b>Lessons:</b></p><br><p><a href='http://www.econedlink.org/e798' target='_blank'>The Family Vacation</a></p><p>Students will take a surprise trip around the world. As they travel, they will use clues to discover where they are going. They will then figure out how much money they have spent in U.S. dollars, using exchange rates.<br><font size="-10"><br /></font><font size="-3">Date Published: 08/03/2009<br />Grades: 6-8, 9-12<br />Source: <a href='http://www.econedlink.org/' target='_blank'>EconEdLink.org</a></font></p><br><p><a href='http://www.econedlink.org/e629' target='_blank'>Why do we need money? Think about Ebay!</a></p><p>The students investigate money--its purpose and functions. They complete an exercise, using the online acution site Ebay, to learn why money is critical to an economy.<br><font size="-10"><br /></font><font size="-3">Date Published: 01/12/2006<br />Grades: 6-8, 9-12<br />Source: <a href='http://www.econedlink.org/' target='_blank'>EconEdLink.org</a></font></p><br><p><a href='http://www.econedlink.org/e605' target='_blank'>Agent Pincher: The Case of the UFO</a></p><p>Agent Pincher: The Case of the UFO--Unfamiliar Foreign Objects. That is what currency from another country may look like. Sometimes when people first try to use money from another country, they feel like they are playing with toy money-it is a different size, color, and shape, compared to one's own national currency, and it often comes with unfamiliar writing. As a special agent, your job is get the facts on these UFOs and compile a profile for guide book for your section.<br><font size="-10"><br /></font><font size="-3">Date Published: 09/09/2005<br />Grades: 6-8<br />Source: <a href='http://www.econedlink.org/' target='_blank'>EconEdLink.org</a></font></p><br><p><a href='http://www.econedlink.org/e586' target='_blank'>The Higher you Climb, The More You Pay</a></p><p>Students will take a "Virtual Tour" of the Eiffel Tower in Paris France and locate the price of a bottle of water at each viewing platform. They will need to problem solve how to pay for admission, buy the water and be able to pay for the telescope at the top of the tower- all for $12.55US.<br><font size="-10"><br /></font><font size="-3">Date Published: 05/23/2007<br />Grades: 6-8<br />Source: <a href='http://www.econedlink.org/' target='_blank'>EconEdLink.org</a></font></p><br><p><a href='http://www.econedlink.org/e342' target='_blank'>Exchange Rates and Exchange: How Money Affects Trade</a></p><p>Students learn how currency values are set by supply and demand, and how changes in the value of currency affect international trade. Students then find the value of the Brazilian Real in 2000 and 2002, determine whether the currency has appreciated or depreciated, and predict the effects on imports and exports.<br><font size="-10"><br /></font><font size="-3">Date Published: 10/08/2002<br />Grades: 9-12<br />Source: <a href='http://www.econedlink.org/' target='_blank'>EconEdLink.org</a></font></p><br>]]></resources>
<related>
<concept>41</concept>
</related>
<quiz>1</quiz>
</concept>
<concept>
<id>18</id>
<name>GDP</name>
<category>1</category>
<definition><![CDATA[<p><b>GDP</b> stands for Gross Domestic Product, which is the total market value of all final <a href="event:function=defineGlossaryTerm,Goods">goods</a> and <a href="event:function=defineGlossaryTerm,Services">services</a> produced within a country, usually measured over a year. GDP is the most inclusive measure of an economy's output. <a href="event:function=defineGlossaryTerm,Nominal Gross Domestic Product (GDP)">Nominal GDP</a> measures the output of goods and services in current <a href="event:function=defineGlossaryTerm,Price">prices</a> while <a href="event:function=defineGlossaryTerm,Real Gross Domestic Product (GDP)">real GDP</a> measures the output of goods and services in constant prices. Real GDP is adjusted for the effects of <a href="event:function=defineGlossaryTerm,Inflation">inflation</a>. The reference to "final" goods and services means that all goods are counted as they are finally produced; that is, there is no need to count the output of the steel industry, which is an "intermediate" input, because the value of the steel will be counted in cars, refrigerators, buildings and all the other final uses of steel. The reference to what is "produced" emphasizes that not all <a href="event:function=defineGlossaryTerm,Sale">sales</a> of goods represent new <a href="event:function=defineGlossaryTerm,Production">production</a>. For example, a new house is included in GDP in the year it is built, but the sale price of a house that was built years ago and resold this year is not included in this year's GDP.</p><br><p>Finally, the emphasis on market value means that GDP measures what the economy spends <a href="event:function=defineGlossaryTerm,Money">money</a> on, which may not always capture well-being. For example, GDP does not directly measure education, health, life expectancy, leisure, protection from crime or environmental protection, but only the amounts of money that are spent with regard to these <a href="event:function=defineGlossaryTerm,Goal">goals</a>.</p> <br><p><a href="event:function=defineGlossaryTerm,Per Capita Gross Domestic Product (GDP)">Per capita GDP</a> is calculated by dividing GDP by the population. Per capita GDP is useful for making comparisons between countries with different population levels or at different points in time. The GDP of China is much higher than that of Switzerland, because China has so many more people, but the per capita GDP of Switzerland is much higher than that of China.</p><br><p><a href="event:function=defineGlossaryTerm,Potential Gross Domestic Product (GDP)">Potential GDP</a> is the level of output when non-labor <a href="event:function=defineGlossaryTerm,Resources">resources</a> are fully employed. Even if the economy has reached its potential GDP, there will still be people unemployed, and this is called the natural level of unemployment.</p>]]></definition>
<lessons><![CDATA[<p>Below are <b>featured</b> lessons for teaching GDP.</p><br><p class="tipHeading">High School Lessons</p><p>--------------------------------------------------------------------</p><p><a href="event:function=viewLesson,68141"><b>Unit 3 - Gross Domestic Product: Measuring a Country's Income</b></a><br><a href="event:function=viewPublication,141">Trading Around the World</a></p><br><p class="smaller_text">How do you measure a person's income? Typically, we measure how much money a person has. But money isn't really the most basic way to measure income since a person's money can be worthless unless there is something to buy. For example, in Germany ...</p><br><p>--------------------------------------------------------------------</p><p><a href="event:function=viewLesson,68042"><b>Lesson 16 - Economic Freedom in China and India</b></a><br><a href="event:function=viewPublication,118">Focus: Understanding Economics in Civics and Government</a></p><br><p class="smaller_text">The students examine a table and two graphs to identify trends in political freedom worldwide, particularly in China and India. They are introduced to the concept of economic freedom, and they discuss examples of the concept. They discuss a graph ...</p><br><p>--------------------------------------------------------------------</p><p><a href="event:function=viewLesson,67729"><b>Lesson 3: Why Do Economies Grow?</b></a><br><a href="event:function=viewPublication,105">Focus: Understanding Economics in U.S. History</a></p><br><p class="smaller_text">The students examine information about former colonies and discuss factors associated with economic growth. They participate in a simulation activity, working in groups to recommend economic development policies for a newly discovered planet. Thro...</p><br><p>--------------------------------------------------------------------</p><p><a href="event:function=viewLesson,67644"><b>Lesson 9 - Globalization and Standards of Living: Prediction and Measurement</b></a><br><a href="event:function=viewPublication,109">Focus: Globalization</a></p><br><p class="smaller_text">In this lesson students consider ways to measure and then compare the degree of globalization and the standards of living in different countries. To introduce the idea of tracking complex social issues using different kinds of data, students plot ...</p><br><p>--------------------------------------------------------------------</p><p><a href="event:function=viewLesson,62479"><b>Lesson 7: Places and Production</b></a><br><a href="event:function=viewPublication,72">Geography: Focus on Economics</a></p><br><p class="smaller_text">Students calculate United States GDP and GDP per capita, use of choropleth map to acquire information, and create choropleth maps of GDP per capita in South America. They identify regions with high and low DGP per capita and suggest reasons why ...</p><br> <p>--------------------------------------------------------------------</p><p><a href="event:function=viewLesson,602"><b><font color="#CC6666">Online Lesson:</font> Closing the Gap</b></a><br><a href='http://www.econedlink.org/' target='_blank'>EconEdLink.org</a></p><br><p class="smaller_text">The students learn what GDP is. They will learn different measures of GDP as well as how GDP per capita can be used to compare countries. They will also calculate GDP per capita and learn how poorer countries can converge, or close the gap, with r...</p><br><p>--------------------------------------------------------------------</p><p><a href="event:function=viewLesson,49"><b><font color="#CC6666">Online Lesson:</font> Economic Forecasting: An Internet WebQuest</b></a><br><a href='http://www.econedlink.org/' target='_blank'>EconEdLink.org</a></p><br><p class="smaller_text">Economics is often called the "science of decision making." The decisions that economists analyze range from personal decisions such as how big a pizza to order or whether to buy or lease a new car to the decisions the federal gover...</p><br><p class="tipHeading">Middle School Lessons</p><p>--------------------------------------------------------------------</p><p><a href="event:function=viewLesson,60335"><b>Lesson 5 - Economic Freedom: How Important Is It?</b></a><br><a href="event:function=viewPublication,53">Middle School World Geography: Focus on Economics</a></p><br><p class="smaller_text">In this lesson, the students participate in activities that help them understand the correlation between economic freedom and a country's standard of living. First the students decide whether they agree or disagree with rules and laws that affect ...</p><br><p>--------------------------------------------------------------------</p><p><a href="event:function=viewLesson,15846"><b>Lesson 1 - Happy Deal?</b></a><br><a href="event:function=viewPublication,3">Mathematics & Economics: Connections for Life - 6-8</a></p><br><p class="smaller_text">In this lesson, the students learn about currencies used in selected countries. They compare the prices of a Big Mac© in different countries and convert the prices into U.S. dollars, using exchange rates. The students determine in which count...</p><br><p>--------------------------------------------------------------------</p><p><a href="event:function=viewLesson,61970"><b>Lesson 3 - Gross Domestic Pizza</b></a><br><a href="event:function=viewPublication,37">Roosters to Robots: Lesson Plans from Writers around the World</a></p><br><p class="smaller_text">This lesson explores how gross domestic product (GDP) is determined. The major components of GDP are described. Students create and compare GDP pie charts for the countries of Pepperonia and Anchovia.</p><br><p>--------------------------------------------------------------------</p><p><a href="event:function=viewLesson,62643"><b>Lesson 13 - An Island Economy</b></a><br><a href="event:function=viewPublication,49">Focus: Middle School Economics</a></p><br><p class="smaller_text">Students participate in a "readers' theater" play too learn about gross domestic product.</p><br><p>--------------------------------------------------------------------</p><p><a href="event:function=viewLesson,62642"><b>Lesson 12 - What Does the Nation Consume?</b></a><br><a href="event:function=viewPublication,49">Focus: Middle School Economics</a></p><br><p class="smaller_text">Students look at their consumption of goods and services in a day. Then, they consider household spending for the nation as a portion of Gross Domestic Product.</p><br> <p>--------------------------------------------------------------------</p><p><a href="event:function=viewLesson,58"><b><font color="#CC6666">Online Lesson:</font> What Does the Nation Consume?</b></a><br><a href='http://www.econedlink.org/' target='_blank'>EconEdLink.org</a></p><br><p class="smaller_text">This lesson will focus on what the nation consumes and how that is measured by Gross Domestic Product (GDP). In the United States, the goods and services produced for household consumption account for about two-thirds of total output.</p><br>]]></lessons>
<tips><![CDATA[<p class="tipHeading">Tip #1</p><p>GDP is the total market value of all final goods and services produced in a country in a given period of time, usually one year. GDP measures an economy's output. Is it also a measure of the economic well-being of a country? Does it account for the quality of a child's education, the safety of a nation's people, the quality of health care, the quality of the environment, the value of leisure or the distribution of income? GDP is clearly an imperfect measure of well-being, but it may still be the single best measurement of economic well-being. Have the students discuss what GDP includes and what it leaves out. Also have the students compare the per capita GDP of various countries, and ask, "Which countries would you want to live in and why?" You must use per capita GDP data to make comparisons among countries because different countries have different numbers of people.</p><br><p class="tipHeading">Tip #2</p><p>When one person spends money, it becomes someone else's income. This idea is often represented by the circular flow diagrams commonly found in high school economics textbooks. This idea leads to the two major ways in which government accountants compute GDP: by measuring total spending or by measuring national income.</p><br><p class="tipHeading">Tip #3</p><p>The definition of GDP could in itself lead to several questions. What is meant by market value? What are final goods? What is the difference between nominal GDP and real GDP? What is excluded from GDP calculations and why?</p><br>]]></tips>
<resources><![CDATA[<p><b>Interactive tools:</b><br /></p><p><font color="#CC6666">Video</font> <a href='http://www.econedlink.org/i204' target='_blank'>Gross Domestic Product (GDP)</a></p><p>This video teaches the concept of Gross Domestic Product (GDP). GDP is the total market value of all final goods and services produced within a country, usually measured over a year.<br><font size="-10"><br /></font><font size="-3">Date Published: 07/12/2012<br>Grades: 6-8, 9-12<br />Source: <a href='http://www.econedlink.org/' target='_blank'>EconEdLink.org</a></font></p><br><p><font color="#CC6666">Video</font> <a href='http://www.econedlink.org/i207' target='_blank'>Real vs. Nominal</a></p><p>This video teaches the concept of Real GDP vs. Nominal GDP.<br><font size="-10"><br /></font><font size="-3">Date Published: 07/12/2012<br>Grades: 6-8, 9-12<br />Source: <a href='http://www.econedlink.org/' target='_blank'>EconEdLink.org</a></font></p><br><p><font color="#CC6666">Video</font> <a href='http://www.econedlink.org/i205' target='_blank'>Inflation</a></p><p>This video teaches the concept of Inflation, which is an increase in the average price level in the economy.<br><font size="-10"><br /></font><font size="-3">Date Published: 07/12/2012<br>Grades: 6-8, 9-12<br />Source: <a href='http://www.econedlink.org/' target='_blank'>EconEdLink.org</a></font></p><br><p><font color="#CC6666">Video</font> <a href='http://www.econedlink.org/i47' target='_blank'>Making Sen$e with Paul Solman: Brazil's President on the G-20, Emerging Markets</a></p><p>Paul Solman interviews Brazilian President Luis Inacio Lula de Silva at the G-20 about the role of developing nations in the global economy.<br><font size="-10"><br /></font><font size="-3">Date Published: 09/24/2009<br>Grades: 9-12<br />Source: <a href='http://www.econedlink.org/' target='_blank'>EconEdLink.org</a></font></p><br><p><font color="#CC6666">Video</font> <a href='http://www.econedlink.org/i197' target='_blank'>Aggregate Demand</a></p><p>This video teaches the concept of Aggregate Demand. Aggregate demand shows the total (or aggregate) demand for final goods and services at a range of price levels for final output during a stated period of time.<br><font size="-10"><br /></font><font size="-3">Date Published: 07/12/2012<br>Grades: 9-12<br />Source: <a href='http://www.econedlink.org/' target='_blank'>EconEdLink.org</a></font></p><br><p>-------------------------------------</p><p><b>Lessons:</b></p><br><p><a href='http://www.econedlink.org/e602' target='_blank'>Closing the Gap</a></p><p>The students learn what GDP is. They will learn different measures of GDP as well as how GDP per capita can be used to compare countries. They will also calculate GDP per capita and learn how poorer countries can converge, or close the gap, with richer countries.<br><font size="-10"><br /></font><font size="-3">Date Published: 10/27/2005<br />Grades: 9-12<br />Source: <a href='http://www.econedlink.org/' target='_blank'>EconEdLink.org</a></font></p><br><p><a href='http://www.econedlink.org/e1010' target='_blank'>Avatar, King of the Box Office?</a></p><p>On January 26, 2010, the film Avatar officially topped Titanic as the top-grossing film of all-time at the box office. However, the following day, Forbes.com published an article entitled Is Avatar Really King of the Box Office? The article explains how using calculations such as the Consumer Price Index (CPI), one can show how the film Gone With the Wind has grossed more when the value of the box office receipts are adjusted for inflation.<br><font size="-10"><br /></font><font size="-3">Date Published: 10/27/2011<br />Grades: 9-12<br />Source: <a href='http://www.econedlink.org/' target='_blank'>EconEdLink.org</a></font></p><br><p><a href='http://www.econedlink.org/e954' target='_blank'>Jokes, Quotations, and Cartoons in Economics</a></p><p>Students will apply their knowledge of economics to the analysis and interpretation of jokes, quotations, and cartoons in economics. Students will watch a Paul Solman video of an interview of Yoram Bauman, the Stand up Economist. Students will use Daryl Cagel's cartoon website, Jokes on the Web, and news media to find economics humor and interpret.<br><font size="-10"><br /></font><font size="-3">Date Published: 07/29/2011<br />Grades: 9-12<br />Source: <a href='http://www.econedlink.org/' target='_blank'>EconEdLink.org</a></font></p><br><p><a href='http://www.econedlink.org/e848' target='_blank'>Okun's Law</a></p><p>The students sharpen their graphing skills by interpreting the relationship between changes in the unemployment rate (%) and real GDP. From this graph, students will determine the natural rate of GDP growth for the U. S. Economy since 1960. They draw the linear relationship between the change in unemployment and GDP and interpret their graphs.<br><font size="-10"><br /></font><font size="-3">Date Published: 11/02/2009<br />Grades: 9-12<br />Source: <a href='http://www.econedlink.org/' target='_blank'>EconEdLink.org</a></font></p><br><p><a href='http://www.econedlink.org/e725' target='_blank'>Transportation: They Say We Had a Revolution (Part 2)</a></p><p>Advancements in transportation have played a key role in the growth of our nation. U.S.government policies have also had a considerable impact on the development of transport as we know it today. In this series of three lessons, the students examine the advancements in automobiles, roads, airlines and airports.<br><font size="-10"><br /></font><font size="-3">Date Published: 06/03/2009<br />Grades: 6-8, 9-12<br />Source: <a href='http://www.econedlink.org/' target='_blank'>EconEdLink.org</a></font></p><br>]]></resources>
<related>
<concept>12</concept>
<concept>13</concept>
<concept>60</concept>
<concept>62</concept>
</related>
<quiz>1</quiz>
</concept>
<concept>
<id>30</id>
<name>Government Failures/Public-Choice Analysis</name>
<category>2</category>
<definition><![CDATA[<p>Ideally in a civics textbook, a democratically elected government makes decisions according to the will of (a majority of) the people. In the real world, <b><a href="event:function=defineGlossaryTerm,Government Failure">government failure</a></b> may occur so that government decisions do not represent the majority. <b>Public-choice analysis </b>is the branch of <a href="event:function=defineGlossaryTerm,Economics">economics</a> that studies how political decisions are actually made. When analyzing government policies, it is useful to examine the <a href="event:function=defineGlossaryTerm,Incentive">incentives</a> of the participants in the government <a href="event:function=defineGlossaryTerm,Decision Making">decision making</a>.</p> <br><p>Here are some examples of government failure. Government regulators and legislators may be heavily influenced by lobbyists and the possibility of getting highly paid <a href="event:function=defineGlossaryTerm,Job">jobs</a> after leaving government service, and so they may focus on the interests of the regulated party, not of citizens. If a small but organized group cares a great deal about a certain government policy, while the majority is unorganized and apathetic, then the <a href="event:function=defineGlossaryTerm,Special Interest Group">special interest</a> may prevail. Legislators may engage in log-rolling, which means that they vote for programs that benefit the districts of other legislators as long as other legislators vote for their pet projects, too. When a government intervention in the economy is proposed, you can't assume that the decision will always favor the broader public interest. </p>]]></definition>
<lessons><![CDATA[<p>Below are <b>featured</b> lessons for teaching Government Failures/Public-Choice Analysis.</p><br><p class="tipHeading">High School Lessons</p><p>--------------------------------------------------------------------</p><p><a href="event:function=viewLesson,60318"><b>Lesson 6 - Public Goods and Services</b></a><br><a href="event:function=viewPublication,38">Old MacDonald to Uncle Sam: Lesson Plans from Writers around the World</a></p><br><p class="smaller_text">Students compare and define private and public goods. They receive money and must make a decision about paying for the heating in the classroom. This activity reinforces the concept of public goods and helps students identify and explain the fre...</p><br><p>--------------------------------------------------------------------</p><p><a href="event:function=viewLesson,17822"><b>Unit 5: Lesson 28 - The Economics of Voting</b></a><br><a href="event:function=viewPublication,1">Capstone: Exemplary Lessons for High School Economics - Teacher's Guide</a></p><br><p class="smaller_text">Students examine a visual to identify patterns of voter turnout in U.S. presidential elections. They analyze the costs and benefits of voting and discuss how people's voting behavior is influenced by incentives.</p><br><p>--------------------------------------------------------------------</p><p><a href="event:function=viewLesson,17821"><b>Unit 5: Lesson 27 - The Economics of Special Interest Groups</b></a><br><a href="event:function=viewPublication,1">Capstone: Exemplary Lessons for High School Economics - Teacher's Guide</a></p><br><p class="smaller_text">Students learn about the diverse nature of special interest groups and read examples that show how incentives influence the actions of elected officials.</p><br><p>--------------------------------------------------------------------</p><p><a href="event:function=viewLesson,63117"><b>Lesson 7: Shady Creatures and the Problem of Special Interest Groups</b></a><br><a href="event:function=viewPublication,74">Focus: Economic Systems</a></p><br><p class="smaller_text">A trading simulation is first used to demonstrate the benefits of free trade. In a later round trade is restricted, which helps a small group of people but hurts many more. Students use basic arithmetic to see why it would be in the economic int...</p><br><p>--------------------------------------------------------------------</p><p><a href="event:function=viewLesson,62186"><b>Chapter 4: Lesson 7 - The Mystery of the Voters Who Don't Vote</b></a><br><a href="event:function=viewPublication,66">The Great Economic Mysteries Book: A Guide to Teaching Economic Reasoning, Grades 9-12</a></p><br><p class="smaller_text">Students describe an economic mystery and discuss various explanations. They use an Activity sheet with a list of clues to help them arrive at a solution for the mystery.</p><br><p>--------------------------------------------------------------------</p><p><a href="event:function=viewLesson,62184"><b>Chapter 4: Lesson 5 - The Mystery of the Missing Pubs</b></a><br><a href="event:function=viewPublication,66">The Great Economic Mysteries Book: A Guide to Teaching Economic Reasoning, Grades 9-12</a></p><br><p class="smaller_text">Students describe an economic mystery and discuss various explanations. They use an Activity sheet with a list of clues to help them arrive at a solution for the mystery.</p><br> <p class="tipHeading">Middle School Lessons</p><p>--------------------------------------------------------------------</p><p><a href="event:function=viewLesson,20771"><b>Lesson 9: Why Restrict Trade?</b></a><br><a href="event:function=viewPublication,9">The Wide World of Trade</a></p><br><p class="smaller_text">Students learn some things about steel and identify a variety of products that are produced with steel. They participate in an activity to help them analyze the costs and benefits of a tariff. Students learn about special-interest groups and con...</p><br> ]]></lessons>
<tips><![CDATA[<p class="tipHeading">Tip #1</p><p>Government failures are usually due to the incentives created by government programs and not bad people. For example, the incentive of profits causes businesses to serve consumers better and keep prices lower. This leads to financial success. To be successful, bureaucrats want more people to work in their departments. That might lead to making rules more complex for citizens or implementing procedures that are less efficient.</p><br><p class="tipHeading">Tip #2</p><p>You can analyze government failures by posing mysteries such as these:<li>Why would the government raise tariffs if they make consumers worse off?</li><li>Why do special interests have so much influence in government when most people do not favor their policies?</li><li>If voting is essential to democracy, why do only 50 percent of eligible voters vote--even in Presidential elections?</li><li>If there is too much milk, why would the government pass a law that costs taxpayers money to support milk production and keeps prices higher for those same taxpayers?</li></p><br>]]></tips>
<resources><![CDATA[<p><b>Interactive tools:</b><br /></p><p><font color="#CC6666">Video</font> <a href='http://www.econedlink.org/i93' target='_blank'>Making Sen$e with Paul Solman: Examining the Underground Greek Economy</a></p><p>Paul Solman continues his series on Greece's debt prolems with a look at the country's large underground economy.<br><font size="-10"><br /></font><font size="-3">Date Published: 07/21/2010<br>Grades: 9-12<br />Source: <a href='http://www.econedlink.org/' target='_blank'>EconEdLink.org</a></font></p><br><p><font color="#CC6666">Video</font> <a href='http://www.econedlink.org/i92' target='_blank'>Making Sen$e with Paul Solman: In Greece, New Measures Rile Many Citizens</a></p><p>Paul Solman looks at how Greek citizens are coping with the debt crisis and speaks with Prime Minister George Papandreou.<br><font size="-10"><br /></font><font size="-3">Date Published: 07/20/2010<br>Grades: 9-12<br />Source: <a href='http://www.econedlink.org/' target='_blank'>EconEdLink.org</a></font></p><br><p><font color="#CC6666">Video</font> <a href='http://www.econedlink.org/i90' target='_blank'>Making Sen$e with Paul Solman: France Considers Reforms Amid Europe Debt Crisis</a></p><p>Paul Solman talks with French Finance Minister Christine Lagarde about the European debt crisis, as France examines new financial reforms.<br><font size="-10"><br /></font><font size="-3">Date Published: 07/07/2010<br>Grades: 9-12<br />Source: <a href='http://www.econedlink.org/' target='_blank'>EconEdLink.org</a></font></p><br><p><font color="#CC6666">Video</font> <a href='http://www.econedlink.org/i88' target='_blank'>Making Sen$e with Paul Solman: Web Extra: Taleb and Roubini</a></p><p>Nassim Taleb and Nouriel Roubini discuss the great economic debate of the moment: more economic stimulus or less?<br><font size="-10"><br /></font><font size="-3">Date Published: 06/29/2010<br>Grades: 9-12<br />Source: <a href='http://www.econedlink.org/' target='_blank'>EconEdLink.org</a></font></p><br><p><font color="#CC6666">Video</font> <a href='http://www.econedlink.org/i260' target='_blank'>Making Sen$e with Paul Solman: Making Sen$e of Bailouts: Why the U.S. Government Bought 'Troubled Assets'</a></p><p><br><font size="-10"><br /></font><font size="-3">Date Published: 08/02/2012<br>Grades: 9-12<br />Source: <a href='http://www.econedlink.org/' target='_blank'>EconEdLink.org</a></font></p><br><p>-------------------------------------</p><p><b>Lessons:</b></p><br><p><a href='http://www.econedlink.org/e1041' target='_blank'>Understanding the Debt Ceiling Debate and the Budget Control Act of 2011</a></p><p>This lesson provides an introduction and an overview of the Budget Control Act of 2011. Students will be given information about the legislation and presented with different proposals for dealing with the long-term deficit problem of the United States.<br><font size="-10"><br /></font><font size="-3">Date Published: 03/08/2012<br />Grades: 9-12<br />Source: <a href='http://www.econedlink.org/' target='_blank'>EconEdLink.org</a></font></p><br><p><a href='http://www.econedlink.org/e702' target='_blank'>Work, Earnings and Economics: Using 'Lyddie' by Katherine Paterson</a></p><p>To get started, the students will read Lyddie, a novel by Katherine Paterson. The novel is set mainly in Lowell, Massachusetts, in the 1840s. In Lowell the main character, 13-year-old Lyddie Worthen, works six days a week, from dawn until dusk, running weaving looms in a murky dust-and lintfilled factory, trying to save enough money to reunite her family. In reading and discussing this fine novel, the students examine basic economic concepts and explore the growth of labor unions and the role of government in a market economy.
Lyddie is published by Puffin Books and is available at Amazon.com. It is also available in DVD video format and may be purchased on line at Circuit City, DVD Empire.com and Overstock.com.<br><font size="-10"><br /></font><font size="-3">Date Published: 09/13/2007<br />Grades: 6-8<br />Source: <a href='http://www.econedlink.org/' target='_blank'>EconEdLink.org</a></font></p><br><p><a href='http://www.econedlink.org/e632' target='_blank'>Satisfaction Please! (Part 3)</a></p><p>Even the savviest consumer has a problem with a good or service on occasion. It is a consumer’s right to complain when there is a genuine problem. In some situations, it is also a consumer’s responsibility. A problem can’t be fixed if no one knows it exists. In this series of three lessons, students learn how to effectively seek redress for a consumer problem. In the first lesson, they are given tips for seeking redress from a seller of a good or service via personal visits, telephone calls and letters. They write a letter in an effort to resolve a consumer problem they or someone they know has experienced. Lessons 2 and 3 focus on what to do when a consumer is unable to get a problem resolved with a seller. A variety of options are presented in both the public and private arena. Students must select sources of outside help that would be appropriate in hypothetical situations they are given.<br><font size="-10"><br /></font><font size="-3">Date Published: 03/09/2006<br />Grades: 9-12<br />Source: <a href='http://www.econedlink.org/' target='_blank'>EconEdLink.org</a></font></p><br><p><a href='http://www.econedlink.org/e631' target='_blank'>Satisfaction Please! (Part 2)</a></p><p>Even the savviest consumer has a problem with a good or service on occasion. It is a consumer’s right to complain when there is a genuine problem. In some situations, it is also a consumer’s responsibility. A problem can’t be fixed if no one knows it exists. In this series of three lessons, the students learn how to effectively seek redress for a consumer problem. In the first lesson, they are given tips for seeking redress from a seller of a good or service via personal visits, telephone calls and letters. They write a letter in an effort to resolve a consumer problem they or someone they know has experienced. Lessons 2 and 3 focus on what to do when a consumer is unable to get a problem resolved with a seller. A variety of options are presented in both the public and private arena. The students must select sources of outside help that would be appropriate in hypothetical situations they are given.<br><font size="-10"><br /></font><font size="-3">Date Published: 11/14/2005<br />Grades: 9-12<br />Source: <a href='http://www.econedlink.org/' target='_blank'>EconEdLink.org</a></font></p><br><p><a href='http://www.econedlink.org/e542' target='_blank'>Worker Safety - The Triangle Fire Legacy</a></p><p>The Triangle Shirtwaist Fire of 1911 was a turning point for employee health and safety protections in the U.S. Students investigate the Triangle tragedy and how its impact is still felt today. Students identify eerie parallels between the Triangle Fire and more recent workplace events with safety implications – recent complaints of Wal-Mart employee lock-ins, a deadly fire in a North Carolina poultry processing plant in 1991, and a 1993 fire in a Thailand toy factory given the sad distinction of most deadly industrial fire in the world. How can future tragedies be prevented in the workplace? Students assess the costs, benefits and effectiveness of various government and labor actions. They discover that worker safety is a complex issue and there is no one-size-fits-all solution.<br><font size="-10"><br /></font><font size="-3">Date Published: 04/06/2004<br />Grades: 6-8, 9-12<br />Source: <a href='http://www.econedlink.org/' target='_blank'>EconEdLink.org</a></font></p><br>]]></resources>
<related>
<concept>8</concept>
<concept>24</concept>
</related>
<quiz>1</quiz>
</concept>
<concept>
<id>45</id>
<name>Human Capital</name>
<category>4</category>
<definition><![CDATA[<p><b>Human capital</b> refers to the combination of a person's education, knowledge, experience, health, habits, training and talent. A person who has acquired more <a href="event:function=defineGlossaryTerm,Human Capital">human capital</a> will be able to produce more. At the individual level, additions to human capital are closely connected to earning higher <a href="event:function=defineGlossaryTerm,Wage">wages</a> and <a href="event:function=defineGlossaryTerm,Income">income</a>. At the level of the national economy, gains in the average level of human capital for the population are a primary source of <a href="event:function=defineGlossaryTerm,Productivity">productivity</a> growth and <a href="event:function=defineGlossaryTerm,Economic Growth">economic growth</a>. People who have earned degrees have shown their ability in an educational setting. This demonstration of ability, and the productivity of what they learned, will make them valuable employees. People improve their human capital by investing in themselves in thousands of ways, but most of the ways involve study, practice and self-discipline.</p>]]></definition>
<lessons><![CDATA[<p>Below are <b>featured</b> lessons for teaching Human Capital.</p><br><p class="tipHeading">High School Lessons</p><p>--------------------------------------------------------------------</p><p><a href="event:function=viewLesson,67764"><b>Lesson 38: The Knowledge and Technology-Based Economy of Today</b></a><br><a href="event:function=viewPublication,105">Focus: Understanding Economics in U.S. History</a></p><br><p class="smaller_text">The students examine information about knowledge workers and their impact on economic expansion. They discuss the opportunity cost
and the benefits of investing in education beyond high school. From 1968 to the present, the knowledgebase sector of...</p><br><p>--------------------------------------------------------------------</p><p><a href="event:function=viewLesson,67643"><b>Lesson 8 - Migration</b></a><br><a href="event:function=viewPublication,109">Focus: Globalization</a></p><br><p class="smaller_text">In an introductory activity students take the roles of people who are affected - some positively and some negatively - by the migration of skilled and unskilled workers. The economic causes and effects of
migration are analyzed and discussed in re...</p><br><p>--------------------------------------------------------------------</p><p><a href="event:function=viewLesson,60259"><b>Lesson 9: The Distribution of Income and Investments in Human Capital</b></a><br><a href="event:function=viewPublication,39">Focus: Institutions and Markets</a></p><br><p class="smaller_text">This lesson introduces students to some key facts about the distribution of income in the United States, and provides some information and tools for analyzing changes in the distribution of income over the last three decades. Students' intuition a...</p><br><p>--------------------------------------------------------------------</p><p><a href="event:function=viewLesson,65604"><b>Lesson 20: Catching Up or Falling Behind? International Comparisons of National Income and Economic Growth</b></a><br><a href="event:function=viewPublication,69">Focus: International Economics</a></p><br><p class="smaller_text">Student teams participate in several rounds of a production simulation to discover the causes of convergence in output and income levels in industrialized nations. Before the simulation, they examine historical evidence on these patterns of conve...</p><br> <p>--------------------------------------------------------------------</p><p><a href="event:function=viewLesson,606"><b><font color="#CC6666">Online Lesson:</font> Capital Investments: Human v. Physical</b></a><br><a href='http://www.econedlink.org/' target='_blank'>EconEdLink.org</a></p><br><p class="smaller_text">In this lesson you will define human capital and understand why it is necessary for economic growth. Also, you will explore how people can increase their personal level of human capital.</p><br><p>--------------------------------------------------------------------</p><p><a href="event:function=viewLesson,602"><b><font color="#CC6666">Online Lesson:</font> Closing the Gap</b></a><br><a href='http://www.econedlink.org/' target='_blank'>EconEdLink.org</a></p><br><p class="smaller_text">The students learn what GDP is. They will learn different measures of GDP as well as how GDP per capita can be used to compare countries. They will also calculate GDP per capita and learn how poorer countries can converge, or close the gap, with r...</p><br><p>--------------------------------------------------------------------</p><p><a href="event:function=viewLesson,305"><b><font color="#CC6666">Online Lesson:</font> Wages and Me</b></a><br><a href='http://www.econedlink.org/' target='_blank'>EconEdLink.org</a></p><br><p class="smaller_text">Students explore the reasons for differences in the wages for several occupations. Then students are guided through the Bureau of Labor Statistics website to find information about their potential careers and wage rates nationally and in thei...</p><br><p>--------------------------------------------------------------------</p><p><a href="event:function=viewLesson,203"><b><font color="#CC6666">Online Lesson:</font> A Fair Wage</b></a><br><a href='http://www.econedlink.org/' target='_blank'>EconEdLink.org</a></p><br><p class="smaller_text">Income for most people is determined by the market value of the productive resources they sell. What workers earn depends, primarily, on the market value of what they produce and how productive they are.</p><br><p class="tipHeading">Middle School Lessons</p><p>--------------------------------------------------------------------</p><p><a href="event:function=viewLesson,68237"><b>Theme 2: Lesson 6 - Productivity</b></a><br><a href="event:function=viewPublication,136">Financial Fitness for Life: Grades 6-8 - Teacher Guide</a></p><br><p class="smaller_text">The students examine ways to develop their human capital. They discover that they make themselves more productive by developing their human capital and by using capital resources, the tools of their trade. As they become more productive, they beco...</p><br><p>--------------------------------------------------------------------</p><p><a href="event:function=viewLesson,68236"><b>Theme 2: Lesson 5 - Choosing a Career</b></a><br><a href="event:function=viewPublication,136">Financial Fitness for Life: Grades 6-8 - Teacher Guide</a></p><br><p class="smaller_text">The lesson focuses on a deliberate approach to making career choices. The students examine statistics projecting future demand for workers in various occupations. They complete a self-assessment to identify career pathways that match their interes...</p><br><p>--------------------------------------------------------------------</p><p><a href="event:function=viewLesson,60333"><b>Lesson 3 - Economics and Population Demographics</b></a><br><a href="event:function=viewPublication,53">Middle School World Geography: Focus on Economics</a></p><br><p class="smaller_text">In this lesson, the students use data and graphs to analyze and compare the populations and standards of living for different countries. The students begin by building a population pyramid of the children in their families over three generations. ...</p><br><p>--------------------------------------------------------------------</p><p><a href="event:function=viewLesson,15853"><b>Lesson 8 - Could You Earn a Million Dollars?</b></a><br><a href="event:function=viewPublication,3">Mathematics & Economics: Connections for Life - 6-8</a></p><br><p class="smaller_text">This lesson is designed to acquaint students with the relationship between earnings and education. The data are very clear regarding one's earning potential and educational attainment. That is, the more education an individual has the greater his ...</p><br><p>--------------------------------------------------------------------</p><p><a href="event:function=viewLesson,20835"><b>Unit 1: Lesson 3 - People Use Their Human Capital</b></a><br><a href="event:function=viewPublication,12">Choices and Changes: In Life, School, and Work- Grades 7-8 - Teacher's Resource Manual</a></p><br><p class="smaller_text">Students take inventory of their own human capital and learn the necessity for acquiring skills and knowledge.</p><br> <p>--------------------------------------------------------------------</p><p><a href="event:function=viewLesson,729"><b><font color="#CC6666">Online Lesson:</font> The Civil War: A War of Resources</b></a><br><a href='http://www.econedlink.org/' target='_blank'>EconEdLink.org</a></p><br><p class="smaller_text">The North won the Civil War in large part due to its superior resources. In this lesson students will learn the difference between capital resources, human capital, and natural resources. They will investigate and compare the resources held by t...</p><br><p>--------------------------------------------------------------------</p><p><a href="event:function=viewLesson,349"><b><font color="#CC6666">Online Lesson:</font> It Pays to Stay in School</b></a><br><a href='http://www.econedlink.org/' target='_blank'>EconEdLink.org</a></p><br><p class="smaller_text">This lesson examines some of the incentive programs being offered to keep students in school</p><br><p class="tipHeading">Elementary Lessons</p><p>--------------------------------------------------------------------</p><p><a href="event:function=viewLesson,68164"><b>Theme 1: Lesson 1 - Earning Income</b></a><br><a href="event:function=viewPublication,134">Financial Fitness for Life: Grades 3-5 - Teacher Guide</a></p><br><p class="smaller_text">The students play a guessing game, using clues to identify various occupations. They consider the education, skills, and talent required for those occupations, and, in doing so, analyze the connection between human capital and wages. They learn th...</p><br><p>--------------------------------------------------------------------</p><p><a href="event:function=viewLesson,67942"><b>Lesson 21: Lunch Money</b></a><br><a href="event:function=viewPublication,116">Teaching Economics Using Children's Literature</a></p><br><p class="smaller_text">Greg is a sixth grader with a love for money. He had his first lemonade stand in second grade and is always looking for new ways to make money. Greg recently discovered that most students bring extra money to school each day, so he has decided it'...</p><br><p>--------------------------------------------------------------------</p><p><a href="event:function=viewLesson,67117"><b>Lesson 5: The Math Factory</b></a><br><a href="event:function=viewPublication,102">Mathematics & Economics: Connections for Life - 3-5</a></p><br><p class="smaller_text">This lesson focuses on productivity (economics) and multiplication (mathematics). The students learn about physical capital and human capital as they create multiplication-fact review cards. In the first production round, groups of students produc...</p><br><p>--------------------------------------------------------------------</p><p><a href="event:function=viewLesson,61985"><b>Lesson 4: Why Do People Go to School?</b></a><br><a href="event:function=viewPublication,101">Learning, Earning and Investing: Grades 4-5 Lessons</a></p><br><p class="smaller_text">The students look at a simple chart relating education level with average annual income. From the data the students generalize that people with more education usually earn more income. They learn that human capital refers to the knowledge, skills,...</p><br><p>--------------------------------------------------------------------</p><p><a href="event:function=viewLesson,20923"><b>Unit 2: Lesson 10 - School Is an Investment in Human Capital</b></a><br><a href="event:function=viewPublication,14">Choices and Changes: In Life, School, and Work - Grades 2-4 - Teacher's Resource Manual</a></p><br><p class="smaller_text">Students will recognize that development of human capital increases the quantity and quality of alternatives available to them now and in the future. They will also take responsibility for their education.</p><br><p>--------------------------------------------------------------------</p><p><a href="event:function=viewLesson,62325"><b>Lesson 13: The Working World</b></a><br><a href="event:function=viewPublication,58">Master Curriculum Guides in Economics: Teaching Strategies - 3-4</a></p><br><p class="smaller_text">Human capital consists of the skills, knowledge, and other factors, such as health, that improve an individual's ability to produce goods and services. One reason people earn different incomes for different jobs is that they differ in the quantit...</p><br> <p>--------------------------------------------------------------------</p><p><a href="event:function=viewLesson,393"><b><font color="#CC6666">Online Lesson:</font> To Be or Not To Be?</b></a><br><a href='http://www.econedlink.org/' target='_blank'>EconEdLink.org</a></p><br><p class="smaller_text">This lesson guides students through web sites that examine careers that are typically of interest to 3rd- through 5th-grade students. By completing the steps outlined in the lesson, the students will explore careers and report their findings.</p><br><p>--------------------------------------------------------------------</p><p><a href="event:function=viewLesson,364"><b><font color="#CC6666">Online Lesson:</font> Economic Spotter: Resources During World War II</b></a><br><a href='http://www.econedlink.org/' target='_blank'>EconEdLink.org</a></p><br><p class="smaller_text">In World War II pennies were made of steel and zinc instead of copper and women were working at jobs that men had always been hired to do. Why? Because during war times, scarcity forces many things to change!</p><br>]]></lessons>
<tips><![CDATA[<p class="tipHeading">Tip #1</p><p>Many economics materials or texts use the term "labor" when it would be better to use the term "human capital". "Labor" would refer to the effort expended by someone in the process of production, often measured in person-hours. The term "human capital" is used to describe the skills and knowledge individuals have gained through experience and/or education. Such technical training and physical skills improve their productive efforts and value in the economy.</p><br><p class="tipHeading">Tip #2</p><p>Students are investing in their human capital in school. Have the students complete a human capital inventory--a checklist of the skills, education and talents they possess. The inventory should include a variety of skills, such as the ability to read and write, compute, work in groups, play an instrument and make people laugh. This list can be used for a number of discussions including goal setting and improvement plans.</p><br><p class="tipHeading">Tip #3</p><p>Human capital is more complex than just getting more education. Here is how Gary Becker, who developed the concept of human capital, describes it in his 1999 Nobel Laureate Lecture:<br><br><i><textformat leftmargin="25">Human capital analysis starts with the assumption that individuals decide on their education, training, medical care, and other additions to knowledge and health by weighing the benefits and costs. Benefits include cultural and other nonmonetary gains along with improvement in earnings and occupations, whereas costs usually depend mainly on the forgone value of the time spent on these investments. The concept of human capital also covers accumulated work and other habits, even including harmful addictions such as smoking and drug use. Human capital in the form of good work habits or addictions to heavy drinking has major positive or negative effects on productivity in both market and nonmarket sectors.</textformat><br><br><textformat leftmargin="25">The various kinds of behavior included under the rubric of human capital help explain why the concept is so powerful and useful. It also means that the process of investing or disinvesting in human capital often alters the very nature of a person: training may change a life-style from one with perennial unemployment to one with stable and good earnings, or accumulated drinking may destroy a career, health, and even the capacity to think straight.</textformat></i></p><br><p class="tipHeading">Tip #4</p><p>Emphasize that a student's decisions today have consequences for the future. Life is not a lottery or a zero-sum game. A student's decisions today can make a real difference tomorrow.</p><br>]]></tips>
<resources><![CDATA[<p><b>Interactive tools:</b><br /></p><p><font color="#CC6666">Video</font> <a href='http://www.econedlink.org/i238' target='_blank'>Making Sen$e with Paul Solman: 'Accordion' Families Expand for Boomerang Kids, 'Parasite Singles' to Move Home</a></p><p>In her new book, "The Accordion Family," sociologist Katherine Newman examines why more young adults in the world's wealthiest countries are returning home to live with their parents -- a phenomenon that Paul Solman has come across repeatedly in h...<br><font size="-10"><br /></font><font size="-3">Date Published: 02/14/2012<br>Grades: 9-12<br />Source: <a href='http://www.econedlink.org/' target='_blank'>EconEdLink.org</a></font></p><br><p><font color="#CC6666">Video</font> <a href='http://www.econedlink.org/i167' target='_blank'>Making Sen$e with Paul Solman: How to Succeed in Business by Really, Really Trying</a></p><p>Is the aptitude for business (the legal kind) distributed among convicted criminals as it is in the general population? One seasoned executive thinks so, and believes that by hiring the cream of the ex-con crop, his company will have a leg up on t...<br><font size="-10"><br /></font><font size="-3">Date Published: 07/27/2011<br>Grades: 9-12<br />Source: <a href='http://www.econedlink.org/' target='_blank'>EconEdLink.org</a></font></p><br><p><font color="#CC6666">Video</font> <a href='http://www.econedlink.org/i152' target='_blank'>Making Sen$e with Paul Solman: So You Have a Liberal Arts Degree and Want a Job?</a></p><p>Paul Solman looks at grads who've already been out of college for several years and are still struggling to find employment in their areas of interest.<br><font size="-10"><br /></font><font size="-3">Date Published: 01/03/2011<br>Grades: 9-12<br />Source: <a href='http://www.econedlink.org/' target='_blank'>EconEdLink.org</a></font></p><br><p><font color="#CC6666">Video</font> <a href='http://www.econedlink.org/i275' target='_blank'>Making Sen$e with Paul Solman: Manufacturer Vita Needle Finds Investment in Older Workers Turns a Big Profit</a></p><p>The average age of Vita Needle's workers is 74 years old, and that's no accident. The manufacturing company has intentionally hired seniors -- a decision that has increased profits and benefited older workers who often have a harder time finding a...<br><font size="-10"><br /></font><font size="-3">Date Published: 01/02/2013<br>Grades: 9-12<br />Source: <a href='http://www.econedlink.org/' target='_blank'>EconEdLink.org</a></font></p><br><p><font color="#CC6666">Video</font> <a href='http://www.econedlink.org/i264' target='_blank'>Making Sen$e with Paul Solman: Is Applying for Jobs Online Not an Effective Way to Find Work?</a></p><p>With a bad economy and nearly everyone on the internet, one job opening promoted online can receive thousands of applications. So with competition fierce and many firms using software rather than human beings to hire, Paul Solman explores whether ...<br><font size="-10"><br /></font><font size="-3">Date Published: 09/25/2012<br>Grades: 9-12<br />Source: <a href='http://www.econedlink.org/' target='_blank'>EconEdLink.org</a></font></p><br><p>-------------------------------------</p><p><b>Lessons:</b></p><br><p><a href='http://www.econedlink.org/e1103' target='_blank'>The 411 on College Education</a></p><p>One of the most important financial decisions people make is whether to go to college. The price tag of a college education is rising, but so are the benefits. In this lesson, students will begin by learning the relationship between level of education and the average unemployment rate; and level of education and median weekly income. Students then learn about wage premiums and investigate the various college options available to them; financing options available to them; the importance of filling out the Free Application for Federal Student Aid (FAFSA); and finally, college as an investment in human capital, examine the costs and benefits, and decide whether it is a good choice.<br><font size="-10"><br /></font><font size="-3">Date Published: 01/25/2013<br />Grades: 9-12<br />Source: <a href='http://www.econedlink.org/' target='_blank'>EconEdLink.org</a></font></p><br><p><a href='http://www.econedlink.org/e951' target='_blank'>LeBron James, The Cavaliers, and Derived Demand</a></p><p>PBS video author Paul Solman reports that LeBron James has added $200 million in value to the city of Cleveland since 2003. His presence brings in $100 million each year to the workers and local businesses surrounding the NBA team. The concept of utilitarianism states that the action which is moral is one, which produces the most good. In the minds of most individuals in Cleveland, the most good would be produced by LeBron staying, is this true or is it possible that a greater good could be achieved if he left? What more important the well being of those in Cleveland or the well-being of the people of another city of that of Lebron James?<br><font size="-10"><br /></font><font size="-3">Date Published: 10/31/2011<br />Grades: 9-12<br />Source: <a href='http://www.econedlink.org/' target='_blank'>EconEdLink.org</a></font></p><br><p><a href='http://www.econedlink.org/e745' target='_blank'>How Labor Got Its Day</a></p><p>If you asked students what comes to mind first when they think of Labor Day, what do you think they would say? The last days of summer? A family picnic? Shopping the Labor Day sales? The purpose of this lesson is to broaden and deepen student understanding of the Labor Day holiday. Students will learn why workers organized unions during the nineteenth century to fight for higher pay and better working conditions. They will discover that unions help balance the power between workers and employers—yielding a better life for many workers and their families today. This is a great lesson to do just before Labor Day. If your school doesn’t begin till after the holiday, consider doing it on May 1—the International Worker’s Rights Day!<br><font size="-10"><br /></font><font size="-3">Date Published: 02/04/2008<br />Grades: 3-5<br />Source: <a href='http://www.econedlink.org/' target='_blank'>EconEdLink.org</a></font></p><br><p><a href='http://www.econedlink.org/e719' target='_blank'>Transportation: They Say We Had a Revolution (Part 1)</a></p><p>Advancements in transportation have played a key role in the growth of our nation. U.S.government policies have also had a considerable impact on the development of transport as we know it today. In this series of three lessons,the students examine transportation and its impact on our nation (and vice versa) since the United States declared its independence in 1776. Lesson 1 focuses on improvements in transportation during the 19th century, particularly the development of a national rail system, to show how invention, innovation and infrastructure encouraged western expansion and economic growth. Lesson 2 moves on to the 20thcentury focusing on the development of auto transport and aviation. The impact on communities and world trade, for both good and bad,is examined. Lesson 3 calls upon the students to create a class time line of transportation milestones; the time line will help the students more clearly understand the factors, especially the economic incentives,that have played a key role in what has been called the 'Transportation Revolution.' While these three lessons will ideally be used together as a set, teachers may choose to use one or two of them, selectively, to focus, for example, on the 19th or the 20th century. If you would like your students to study the economics of transportation in more depth, consider following up with the EconEdLink lesson, An Economic Mystery: What Happened to Railroads?<br><font size="-10"><br /></font><font size="-3">Date Published: 01/30/2008<br />Grades: 6-8, 9-12<br />Source: <a href='http://www.econedlink.org/' target='_blank'>EconEdLink.org</a></font></p><br><p><a href='http://www.econedlink.org/e702' target='_blank'>Work, Earnings and Economics: Using 'Lyddie' by Katherine Paterson</a></p><p>To get started, the students will read Lyddie, a novel by Katherine Paterson. The novel is set mainly in Lowell, Massachusetts, in the 1840s. In Lowell the main character, 13-year-old Lyddie Worthen, works six days a week, from dawn until dusk, running weaving looms in a murky dust-and lintfilled factory, trying to save enough money to reunite her family. In reading and discussing this fine novel, the students examine basic economic concepts and explore the growth of labor unions and the role of government in a market economy.
Lyddie is published by Puffin Books and is available at Amazon.com. It is also available in DVD video format and may be purchased on line at Circuit City, DVD Empire.com and Overstock.com.<br><font size="-10"><br /></font><font size="-3">Date Published: 09/13/2007<br />Grades: 6-8<br />Source: <a href='http://www.econedlink.org/' target='_blank'>EconEdLink.org</a></font></p><br>]]></resources>
<related>
<concept>61</concept>
<concept>69</concept>
</related>
<quiz>1</quiz>
</concept>
<concept>
<id>8</id>
<name>Incentives</name>
<category>0</category>
<definition><![CDATA[<p>An <b>incentive</b> is a <a href="event:function=defineGlossaryTerm,Costs">cost</a> or <a href="event:function=defineGlossaryTerm,Benefit">benefit</a> that motivates a decision or action by <a href="event:function=defineGlossaryTerm,Consumers">consumers</a>, <a href="event:function=defineGlossaryTerm,Workers">workers</a>, <a href="event:function=defineGlossaryTerm,Firms">firms</a> or other participants in the economy. Higher or lower <a href="event:function=defineGlossaryTerm,Price">prices</a> provide <a href="event:function=defineGlossaryTerm,Incentive">incentives</a>; specifically, higher prices give consumers an incentive to buy less and firms an incentive to produce more. Higher and lower <a href="event:function=defineGlossaryTerm,Wage">wages</a> provide incentives; that is, many people will work longer or harder for higher wages, but firms will try to hire a lower quantity of <a href="event:function=defineGlossaryTerm,Workers">workers</a> if wages are higher. <a href="event:function=defineGlossaryTerm,Interest Rate">Interest rates</a> provide incentives too; people have a greater incentive to <a href="event:function=defineGlossaryTerm,Borrow">borrow</a> money to purchase a home or a car if interest rates are lower. The primary incentive for firms is to earn a greater <a href="event:function=defineGlossaryTerm,Profit">profit.</a> Economists take the principle that people respond to incentives very seriously. In every decision, incentives matter.</p>]]></definition>
<lessons><![CDATA[<p>Below are <b>featured</b> lessons for teaching Incentives.</p><br><p class="tipHeading">High School Lessons</p><p>--------------------------------------------------------------------</p><p><a href="event:function=viewLesson,68045"><b>Lesson 19 - Immigration</b></a><br><a href="event:function=viewPublication,118">Focus: Understanding Economics in Civics and Government</a></p><br><p class="smaller_text">The students analyze legal and illegal immigration, creating concept maps to identify the incentives and disincentives that may influence prospective immigrants as they make their decisions.</p><br><p>--------------------------------------------------------------------</p><p><a href="event:function=viewLesson,68033"><b>Lesson 7 - Taxes Change Behavior</b></a><br><a href="event:function=viewPublication,118">Focus: Understanding Economics in Civics and Government</a></p><br><p class="smaller_text">The students review the economic functions of government, noting that taxes are necessary to pay for government activities. Then they consider how the government can influence behavior through taxation, by taxing sources of pollution to reduce emi...</p><br><p>--------------------------------------------------------------------</p><p><a href="event:function=viewLesson,68060"><b>Lesson 4 - Rush Hour</b></a><br><a href="event:function=viewPublication,133">Economics from Here to There </a></p><br><p class="smaller_text">Incentives that people face influence their everyday decisions. Using a road-map game board, the students simulate driving to work and choose driving routes based on incentives. The students analyze how changes in incentives cause changes in behav...</p><br><p>--------------------------------------------------------------------</p><p><a href="event:function=viewLesson,65717"><b>Lesson 1: A Parking Lot Full of Incentives</b></a><br><a href="event:function=viewPublication,63">Economies in Transition: Command to Market</a></p><br><p class="smaller_text">Students become familiar with the profit motive of market economies through a newspaper story about parking lot prices and whether government should intervene to control them. Next students play the role of parking lot managers in a command econo...</p><br><p>--------------------------------------------------------------------</p><p><a href="event:function=viewLesson,62508"><b>Lesson 3- Trade In Africa: 9th to 12th Centuries A.D.</b></a><br><a href="event:function=viewPublication,70">World History: Focus on Economics</a></p><br><p class="smaller_text">The teacher displays a visual showing the graphic regions and trade routes between North and West Africa. Students read a short passage and answer questions in class discussion. Students in groups calculate the efficiency of various methods of t...</p><br> <p>--------------------------------------------------------------------</p><p><a href="event:function=viewLesson,139"><b><font color="#CC6666">Online Lesson:</font> The Economics of Voting</b></a><br><a href='http://www.econedlink.org/' target='_blank'>EconEdLink.org</a></p><br><p class="smaller_text">Since the 1960's, many Americans eligible to vote have not bothered to do so- not even in presidential elections. Low rates of participation in voting have been worrisome to people interested in preserving our democratic traditions. Economists hav...</p><br><p>--------------------------------------------------------------------</p><p><a href="event:function=viewLesson,625"><b><font color="#CC6666">Online Lesson:</font> Fewer Watts and Fatter Wallets</b></a><br><a href='http://www.econedlink.org/' target='_blank'>EconEdLink.org</a></p><br><p class="smaller_text">Students learn about incentives for alternative energy programs and the role played by non-price determinants in energy choices.</p><br><p>--------------------------------------------------------------------</p><p><a href="event:function=viewLesson,570"><b><font color="#CC6666">Online Lesson:</font> Timing Is Everything</b></a><br><a href='http://www.econedlink.org/' target='_blank'>EconEdLink.org</a></p><br><p class="smaller_text">In the first part of the lesson students examine the incentives and opportunity costs of spending and saving in a teacher directed lesson. The remainder of the lesson is an interactive web site. Students work through problems that demonstrate...</p><br><p>--------------------------------------------------------------------</p><p><a href="event:function=viewLesson,526"><b><font color="#CC6666">Online Lesson:</font> Be an Energy Saver</b></a><br><a href='http://www.econedlink.org/' target='_blank'>EconEdLink.org</a></p><br><p class="smaller_text">This lesson focuses on the scarce and nonrenewable nature of fossil fuels in order to stimulate student thinking about energy conservation. It emphasizes the fact that saving energy can be good for the wallet as well as the earth's future. S...</p><br><p>--------------------------------------------------------------------</p><p><a href="event:function=viewLesson,444"><b><font color="#CC6666">Online Lesson:</font> Classroom Cash Incentive Plan</b></a><br><a href='http://www.econedlink.org/' target='_blank'>EconEdLink.org</a></p><br><p class="smaller_text">Students will be rewarded for positive behavior and performance in class through a monetary incentive program. Classroom cash will be earned on a daily basis for such things as attendance, punctuality, and assignment completion. Conversely,...</p><br><p class="tipHeading">Middle School Lessons</p><p>--------------------------------------------------------------------</p><p><a href="event:function=viewLesson,65760"><b>Lesson 6 - How Can We Help Endangered Species?</b></a><br><a href="event:function=viewPublication,95">Economics and the Environment: Ecodetectives</a></p><br><p class="smaller_text">The students are presented with information about the Endangered Species Act (ESA) and examples of species appearing on the protected list. They examine the history of species protection under the ESA. They are asked to imagine how the ESA would w...</p><br><p>--------------------------------------------------------------------</p><p><a href="event:function=viewLesson,60339"><b>Lesson 9 - The Cost of Ignoring Economics and Geography</b></a><br><a href="event:function=viewPublication,53">Middle School World Geography: Focus on Economics</a></p><br><p class="smaller_text">In this lesson, the students learn how geography affects the costs of achieving an environmental goal. They remodel the classroom using a map showing several companies located along a river. They participate in a simulation that shows the impact o...</p><br><p>--------------------------------------------------------------------</p><p><a href="event:function=viewLesson,20845"><b>Unit 3: Lesson 13 - What Influences My Choices?</b></a><br><a href="event:function=viewPublication,12">Choices and Changes: In Life, School, and Work- Grades 7-8 - Teacher's Resource Manual</a></p><br><p class="smaller_text">Students conduct paired interviews to learn what kinds of influences affect their choices.</p><br><p>--------------------------------------------------------------------</p><p><a href="event:function=viewLesson,62201"><b>Chapter 3: Lesson 3 - The Mystery of the Lost and Found That's Always Stocked</b></a><br><a href="event:function=viewPublication,45">The Great Economic Mysteries Book: A Guide to Teaching Economic Reasoning, Grades 4-8</a></p><br><p class="smaller_text">Students describe an economic mystery and discuss various explanations of it. They use economic principles and true/false clues in reasoning out a solution to the mystery.</p><br> <p>--------------------------------------------------------------------</p><p><a href="event:function=viewLesson,394"><b><font color="#CC6666">Online Lesson:</font> Fill 'er up, Please</b></a><br><a href='http://www.econedlink.org/' target='_blank'>EconEdLink.org</a></p><br><p class="smaller_text">Americans drive more than 2.6 trillion miles per year, that's 14,000 round trips to the sun! And for the most part, these vehicles are all running on gasoline. For many of us, we watch the price of gas as closely as the price of a gallon of m...</p><br><p>--------------------------------------------------------------------</p><p><a href="event:function=viewLesson,349"><b><font color="#CC6666">Online Lesson:</font> It Pays to Stay in School</b></a><br><a href='http://www.econedlink.org/' target='_blank'>EconEdLink.org</a></p><br><p class="smaller_text">This lesson examines some of the incentive programs being offered to keep students in school</p><br><p class="tipHeading">Elementary Lessons</p><p>--------------------------------------------------------------------</p><p><a href="event:function=viewLesson,68168"><b>Theme 2: Lesson 5 - Saving Starts with Wanting More</b></a><br><a href="event:function=viewPublication,134">Financial Fitness for Life: Grades 3-5 - Teacher Guide</a></p><br><p class="smaller_text">This lesson provides activities designed to help students think clearly about decisions related to saving money. The students set a goal, determine a strategy for saving, and decide how they will save to achieve their goals. They also learn the ba...</p><br><p>--------------------------------------------------------------------</p><p><a href="event:function=viewLesson,62327"><b>Lesson 15: An Entrepreneurial Experience Extraordinaire</b></a><br><a href="event:function=viewPublication,58">Master Curriculum Guides in Economics: Teaching Strategies - 3-4</a></p><br><p class="smaller_text">In the previous lesson students established a company and participated in various preproduction activities. This lesson involves the implementation of production, marketing, and distribution decisions for Orange Juice Jubilee. Students will concl...</p><br><p>--------------------------------------------------------------------</p><p><a href="event:function=viewLesson,62324"><b>Lesson 12: A Classy Competition</b></a><br><a href="event:function=viewPublication,58">Master Curriculum Guides in Economics: Teaching Strategies - 3-4</a></p><br><p class="smaller_text">People experience competition every day. Competition challenges people to try harder, practice more, and invest more time and energy in order to do their best. Competition not only encourages individuals to do their best, it also encourages busi...</p><br> <p>--------------------------------------------------------------------</p><p><a href="event:function=viewLesson,378"><b><font color="#CC6666">Online Lesson:</font> Incentives Influence Us!</b></a><br><a href='http://www.econedlink.org/' target='_blank'>EconEdLink.org</a></p><br><p class="smaller_text">Students will learn that people respond predictably to positive incentives (rewards) and negative incentives (penalties). They will identify incentives in their daily lives at home and school. Students will discuss which incentives have worke...</p><br><p>--------------------------------------------------------------------</p><p><a href="event:function=viewLesson,390"><b><font color="#CC6666">Online Lesson:</font> Economic Incentives in Our Community</b></a><br><a href='http://www.econedlink.org/' target='_blank'>EconEdLink.org</a></p><br><p class="smaller_text">Students will identify positive and negative economic incentives used in their communities to encourage people to make CHOICES beneficial to the community. Students will recognize that not all incentives convince all people, since people have...</p><br><p>--------------------------------------------------------------------</p><p><a href="event:function=viewLesson,379"><b><font color="#CC6666">Online Lesson:</font> What Are Incentives?</b></a><br><a href='http://www.econedlink.org/' target='_blank'>EconEdLink.org</a></p><br><p class="smaller_text">Students will understand that incentives are used to encourage them to make good choices. After identifying incentives offered at home and in school, the students will distinguish between positive and negative incentives.</p><br><p>--------------------------------------------------------------------</p><p><a href="event:function=viewLesson,260"><b><font color="#CC6666">Online Lesson:</font> Inventive Incentive</b></a><br><a href='http://www.econedlink.org/' target='_blank'>EconEdLink.org</a></p><br><p class="smaller_text">There are many ways in which people are rewarded or penalized for doing, or not doing, their work. These are known as “incentives.”</p><br><p>--------------------------------------------------------------------</p><p><a href="event:function=viewLesson,232"><b><font color="#CC6666">Online Lesson:</font> Tricks for Treats</b></a><br><a href='http://www.econedlink.org/' target='_blank'>EconEdLink.org</a></p><br><p class="smaller_text">Students will recognize that people (and animals) will work for incentives.</p><br>]]></lessons>
<tips><![CDATA[<p class="tipHeading">Tip #1</p><p>The students respond to incentives at home and at school. Share with them incentives to which you respond in your life. Then ask them to think about the incentives to which they respond. For example, they may refrain from running in the hallway in response to the possibility of a penalty for that behavior. They may help out an elderly neighbor because it makes them feel good to do so. They may save because their parents have agreed to match the amount that they save. They may do extra chores around the house to earn income. It is important that the students see examples of both monetary and nonmonetary incentives.</p><br><p class="tipHeading">Tip #2</p><p>A common error of students is to consider financial incentives as the only important incentives to influence individual choices. While financial incentives can be important and are easy to measure, nonmonetary incentives, such as loyalty, stability, love, good grades and public recognition, also influence individual choices.</p><br><p class="tipHeading">Tip #3</p><p>Discuss the incentives that are present in your class that encourage or discourage certain types of behavior. There could be positive incentives, such as grades, or negative incentives, such as staying after school for being late for class. Have the students discuss the most effective incentives in the class and explain why they are effective.</p><br>]]></tips>
<resources><![CDATA[<p><b>Interactive tools:</b><br /></p><p><font color="#CC6666">Video</font> <a href='http://www.econedlink.org/i235' target='_blank'>Making Sen$e with Paul Solman: Taxes: How High Is Too High?</a></p><p>Economics correspondent Paul Solman explores the question of just how high U.S. tax rates should or shouldn't be and examines the relationship between economic activity and tax rates. It's part of his ongoing reporting series, Making Sen$e of fina...<br><font size="-10"><br /></font><font size="-3">Date Published: 01/11/2012<br>Grades: 9-12<br />Source: <a href='http://www.econedlink.org/' target='_blank'>EconEdLink.org</a></font></p><br><p><font color="#CC6666">Video</font> <a href='http://www.econedlink.org/i177' target='_blank'>Making Sen$e with Paul Solman: Does U.S. Economic Inequality Have a Good Side?</a></p><p>A new Congressional Budget Office analysis supports the idea that income inequality has grown considerably over the past few decades. As part of his Making Sen$e series on economic inequality, Paul Solman talks to libertarian law professor Richard...<br><font size="-10"><br /></font><font size="-3">Date Published: 10/26/2011<br>Grades: 9-12<br />Source: <a href='http://www.econedlink.org/' target='_blank'>EconEdLink.org</a></font></p><br><p><font color="#CC6666">Video</font> <a href='http://www.econedlink.org/i161' target='_blank'>Making Sen$e with Paul Solman: Oscar-Winning 'Inside Job' Director Attacks Economists' Ties to Financial Sector</a></p><p>As part of his continuing coverage of Making Sen$e of financial news, Paul Solman reports on the aftermath of the financial crisis and how the Academy Award-winning documentary, "Inside Job" is influencing some leading economic thinkers. The film ...<br><font size="-10"><br /></font><font size="-3">Date Published: 05/04/2011<br>Grades: 9-12<br />Source: <a href='http://www.econedlink.org/' target='_blank'>EconEdLink.org</a></font></p><br><p><font color="#CC6666">Video</font> <a href='http://www.econedlink.org/i57' target='_blank'>Making Sen$e with Paul Solman: Is Retirement Good for You?</a></p><p>Paul Solman explores the debate over whether retirement is good or bad for your health.<br><font size="-10"><br /></font><font size="-3">Date Published: 12/10/2009<br>Grades: 9-12<br />Source: <a href='http://www.econedlink.org/' target='_blank'>EconEdLink.org</a></font></p><br><p><font color="#CC6666">Video</font> <a href='http://www.econedlink.org/i272' target='_blank'>Lawmakers Consider Cutting Tax Deductions to Bring Down the Deficit</a></p><p>While tax breaks are popular, their future may be limited. Congressional leaders are deliberating on how they can increase revenue in order to bring down the deficit, and deductions may be on the chopping block. Paul Solman explores write-offs for...<br><font size="-10"><br /></font><font size="-3">Date Published: 12/10/2012<br>Source: <a href='http://www.econedlink.org/' target='_blank'>EconEdLink.org</a></font></p><br><p>-------------------------------------</p><p><b>Lessons:</b></p><br><p><a href='http://www.econedlink.org/e1100' target='_blank'>Pop Goes the Housing Bubble</a></p><p>In this lesson, students will learn about a speculative bubble within the context of the U.S. real estate market.<br><font size="-10"><br /></font><font size="-3">Date Published: 03/11/2013<br />Grades: 9-12<br />Source: <a href='http://www.econedlink.org/' target='_blank'>EconEdLink.org</a></font></p><br><p><a href='http://www.econedlink.org/e1018' target='_blank'>Chevy Volt...It’s Electric!</a></p><p>The costs and benefits of owning an electric or hybrid car will be evaluated in this lesson. By reading and researching the history of the production of electric cars, the lesson allows students to understand how this market has developed. Specifically, the evaluation will focus on the Chevy Volt and its attempt to compete in a constantly evolving market of automobiles. Through this lesson, students will attempt to decide whether the Volt can be competitive in price and range, as well as what incentives need to be provided to make it a more appealing purchase to consumers. There have also been several changes made to the aerodynamics of the prototype of the Volt to the first model released to consumers in order to make the battery more efficient. Finally, students will look at the supply and demand, and production of the Chevy Volt.<br><font size="-10"><br /></font><font size="-3">Date Published: 12/20/2011<br />Grades: 6-8, 9-12<br />Source: <a href='http://www.econedlink.org/' target='_blank'>EconEdLink.org</a></font></p><br><p><a href='http://www.econedlink.org/e954' target='_blank'>Jokes, Quotations, and Cartoons in Economics</a></p><p>Students will apply their knowledge of economics to the analysis and interpretation of jokes, quotations, and cartoons in economics. Students will watch a Paul Solman video of an interview of Yoram Bauman, the Stand up Economist. Students will use Daryl Cagel's cartoon website, Jokes on the Web, and news media to find economics humor and interpret.<br><font size="-10"><br /></font><font size="-3">Date Published: 07/29/2011<br />Grades: 9-12<br />Source: <a href='http://www.econedlink.org/' target='_blank'>EconEdLink.org</a></font></p><br><p><a href='http://www.econedlink.org/e949' target='_blank'>The Economics of Pro Sports: Why are the Cowboys and Yankees so Valuable?</a></p><p>This lesson investigates the value of sports franchises in the various professional sports leagues. Students will investigate the revenues and costs of pro sports teams and determine which teams are the most valuable. Lastly, students will understand the specific rules of the game that leagues employ that influence franchise values.<br><font size="-10"><br /></font><font size="-3">Date Published: 01/26/2012<br />Grades: 9-12<br />Source: <a href='http://www.econedlink.org/' target='_blank'>EconEdLink.org</a></font></p><br><p><a href='http://www.econedlink.org/e911' target='_blank'>Trouble is Brewing in Boston - "Colonial Voices: Hear Them Speak"</a></p><p>It’s December 16, 1773 and many of the citizens of Boston are furious with King George’s new tax on tea. Young Ethan, a printer’s errand boy, has been given the task of conveying information concerning an upcoming protest meeting. As he makes his rounds through the city the reader is introduced to the goods and services provided by colonial merchants.
[NOTE: These lessons are based on the book "Colonial Voices Hear Them Speak" by Kay Winters. However, it is not necessary for the students to have read the book to successfully complete the activities.]<br><font size="-10"><br /></font><font size="-3">Date Published: 01/27/2011<br />Grades: K-2, 3-5<br />Source: <a href='http://www.econedlink.org/' target='_blank'>EconEdLink.org</a></font></p><br>]]></resources>
<related>
<concept>1</concept>
<concept>30</concept>
<concept>35</concept>
<concept>55</concept>
</related>
<quiz>1</quiz>
</concept>
<concept>
<id>27</id>
<name>Income Distribution</name>
<category>2</category>
<definition><![CDATA[<p><a href="event:function=defineGlossaryTerm,Distribution of Income"><b>Income distribution</b></a> refers to how the total <a href="event:function=defineGlossaryTerm,Income">income</a> earned ends up divided over members of the economy. One common method of describing the income distribution is to divide the population into equal-sized groups, and then to say what share of income is received by each group. For example, in the United States in recent years, the bottom fifth of all <a href="event:function=defineGlossaryTerm,Households">households</a> ranked by income have received about 4 percent of all income earned in a given year; the second fifth, 9 percent; the third fifth, 15 percent; the fourth fifth, 23 percent; and the top fifth, 50 percent.</p><br><p>A perfectly equal income distribution would mean that everyone receives exactly the same income. However, there is no reason to expect a perfectly equal income distribution. After all, some people are in their 20s, some in their 50s, and some in their 80s--so incomes are different in a given year because of where people are in their life cycle. Some people pursue careers that require higher levels of skills; others do not. Some people choose to work extra <a href="event:function=defineGlossaryTerm,Job">jobs</a> to earn additional income; others do not. Also, the income distribution in any given year does not reveal how many people are moving higher or lower in the income distribution over time. Given these complications, whether the level of <a href="event:function=defineGlossaryTerm,Income Inequality">income inequality</a> in the current income distribution should be viewed as fair, unfair or somewhere in between is a controversial issue. In fact, even people's definition of "fair" can differ dramatically.</p><br><p>The <a href="event:function=defineGlossaryTerm,Functional Distribution of Income">functional distribution of income</a> refers to how income is divided among <a href="event:function=defineGlossaryTerm,Wage">wages</a>, <a href="event:function=defineGlossaryTerm,Interest">interest</a>, rents and <a href="event:function=defineGlossaryTerm,Profit">profits</a>. In the U.S. <a href="event:function=defineGlossaryTerm,Market Economy">market economy</a>, the bulk of total income goes to wages. About three-fourths of our national income is wages. When commentators claim that most income goes to <a href="event:function=defineGlossaryTerm,Business">business</a> profits or rents to large landowners, this is factually wrong.</p>]]></definition>
<lessons><![CDATA[<p>Below are <b>featured</b> lessons for teaching Income Distribution.</p><br><p class="tipHeading">High School Lessons</p><p>--------------------------------------------------------------------</p><p><a href="event:function=viewLesson,68292"><b>Theme 2: Lesson 6 - Why Some Jobs Pay More than Others</b></a><br><a href="event:function=viewPublication,138">Financial Fitness for Life: 9-12 - Teacher Guide</a></p><br><p class="smaller_text">Why do some people earn more income than others? This lesson explores that question. It begins by clarifying what income is. Then it focuses on the relationship between human capital and income. It culminates with an activity linking levels of ed...</p><br><p>--------------------------------------------------------------------</p><p><a href="event:function=viewLesson,60259"><b>Lesson 9: The Distribution of Income and Investments in Human Capital</b></a><br><a href="event:function=viewPublication,39">Focus: Institutions and Markets</a></p><br><p class="smaller_text">This lesson introduces students to some key facts about the distribution of income in the United States, and provides some information and tools for analyzing changes in the distribution of income over the last three decades. Students' intuition a...</p><br><p>--------------------------------------------------------------------</p><p><a href="event:function=viewLesson,17824"><b>Unit 5: Lesson 30 - Poverty and Income Inequality</b></a><br><a href="event:function=viewPublication,1">Capstone: Exemplary Lessons for High School Economics - Teacher's Guide</a></p><br><p class="smaller_text">Students take part in an activity that simulates the unequal distribution of income in the United States, based on U.S. Census data. They discuss how equal distribution of income would affect incentives to work hard, especially for high-income ea...</p><br><p>--------------------------------------------------------------------</p><p><a href="event:function=viewLesson,65693"><b>Lesson 10: Distribution of Income: Different Ways to Slice the Pie</b></a><br><a href="event:function=viewPublication,64">From Plan to Market: Teaching Ideas for Social Studies, Economics, and Business Classes</a></p><br><p class="smaller_text">In this lesson, students investigate some of the advantages and disadvantages of market and command economic systems by participating in a simulation and reading about the experiences of people living in Ukraine in 1997. The pains of transition a...</p><br> <p>--------------------------------------------------------------------</p><p><a href="event:function=viewLesson,885"><b><font color="#CC6666">Online Lesson:</font> Graphing a Lorenz Curve and Calculating the Gini Coefficient</b></a><br><a href='http://www.econedlink.org/' target='_blank'>EconEdLink.org</a></p><br><p class="smaller_text">In this lesson, students receive raw data to construct a Lorenz Curve and calculate the Gini Coefficient. This lesson prepares AP Microeconomics students for the Advanced Placement exam. The teacher will briefly interpret the Gini Coefficient.</p><br><p>--------------------------------------------------------------------</p><p><a href="event:function=viewLesson,65"><b><font color="#CC6666">Online Lesson:</font> Income: It Ain't Where You Start, It's What You Got, and Where You End</b></a><br><a href='http://www.econedlink.org/' target='_blank'>EconEdLink.org</a></p><br><p class="smaller_text">This year's federal elections will involve electing a president, all members of the House of Representatives, and one third of the Senate. Barring some international crisis, economic issues appear likely to dominate the debates. In past elect...</p><br><p>--------------------------------------------------------------------</p><p><a href="event:function=viewLesson,154"><b><font color="#CC6666">Online Lesson:</font> The American Standard of Living - For Better or For Worse</b></a><br><a href='http://www.econedlink.org/' target='_blank'>EconEdLink.org</a></p><br><p class="smaller_text">Is the distribution of income in the United States becoming more unequal? Does the average American today have a higher or lower standard of living than the average American of a generation ago? Will the next generation have a higher or lower stan...</p><br>]]></lessons>
<tips><![CDATA[<p class="tipHeading">Tip #1</p><p>The most widely used measure to illustrate the distribution of income is a Lorenz curve, which provides a visual illustration of how income is distributed among members of a population. Equal incomes are represented by a 45-degree line. The actual distribution of income is plotted against that line. The farther the Lorenz curve bows out, away from the line of income equality, the more unequal the distribution of income is.</p><br><p class="tipHeading">Tip #2</p><p>The functional distribution of income is different from the personal distribution of income. The functional distribution of income refers to how income is divided among wages, interest, rents and profits. The personal distribution of income refers to how income is distributed among the members of an economy.</p><br><p class="tipHeading">Tip #3</p><p>Have the students research whether the personal distribution of income has become more equal or unequal in recent years.</p><br>]]></tips>
<resources><![CDATA[<p><b>Interactive tools:</b><br /></p><p><font color="#CC6666">Video</font> <a href='http://www.econedlink.org/i183' target='_blank'>Making Sen$e with Paul Solman: Why Are Conservatives Happier Than Liberals?</a></p><p>How do feelings about ideology and economic inequality affect a person's happiness? As part of his reporting of Making Sen$e of financial news, economics correspondent Paul Solman explores the connection and asks some liberals at Occupy DC and con...<br><font size="-10"><br /></font><font size="-3">Date Published: 12/09/2011<br>Grades: 9-12<br />Source: <a href='http://www.econedlink.org/' target='_blank'>EconEdLink.org</a></font></p><br><p><font color="#CC6666">Video</font> <a href='http://www.econedlink.org/i272' target='_blank'>Lawmakers Consider Cutting Tax Deductions to Bring Down the Deficit</a></p><p>While tax breaks are popular, their future may be limited. Congressional leaders are deliberating on how they can increase revenue in order to bring down the deficit, and deductions may be on the chopping block. Paul Solman explores write-offs for...<br><font size="-10"><br /></font><font size="-3">Date Published: 12/10/2012<br>Source: <a href='http://www.econedlink.org/' target='_blank'>EconEdLink.org</a></font></p><br><p><font color="#CC6666">Video</font> <a href='http://www.econedlink.org/i246' target='_blank'>Making Sen$e with Paul Solman: Man vs. Machine: Will Human Workers Become Obsolete?</a></p><p>Part of his series on Making Sen$e of financial news, Paul Solman has been showcasing the future of technology from a recent conference run by a California think tank -- things such as 3-D printing of prosthetic legs and iPhone heart tests. But th...<br><font size="-10"><br /></font><font size="-3">Date Published: 05/24/2012<br>Grades: 9-12<br />Source: <a href='http://www.econedlink.org/' target='_blank'>EconEdLink.org</a></font></p><br><p><font color="#CC6666">Video</font> <a href='http://www.econedlink.org/i240' target='_blank'>Making Sen$e with Paul Solman: Author Charles Murray: Elites Should Teach Working Class How to Live REPORT</a></p><p>The super-educated upper class is out of touch but it could teach lower classes better ways to live, according to conservative lightning rod Charles Murray. As part of his series on Making Sen$e of financial news, Paul Solman speaks with Murray ab...<br><font size="-10"><br /></font><font size="-3">Date Published: 03/20/2012<br>Grades: 9-12<br />Source: <a href='http://www.econedlink.org/' target='_blank'>EconEdLink.org</a></font></p><br><p><font color="#CC6666">Video</font> <a href='http://www.econedlink.org/i177' target='_blank'>Making Sen$e with Paul Solman: Does U.S. Economic Inequality Have a Good Side?</a></p><p>A new Congressional Budget Office analysis supports the idea that income inequality has grown considerably over the past few decades. As part of his Making Sen$e series on economic inequality, Paul Solman talks to libertarian law professor Richard...<br><font size="-10"><br /></font><font size="-3">Date Published: 10/26/2011<br>Grades: 9-12<br />Source: <a href='http://www.econedlink.org/' target='_blank'>EconEdLink.org</a></font></p><br><p>-------------------------------------</p><p><b>Lessons:</b></p><br><p><a href='http://www.econedlink.org/e154' target='_blank'>The American Standard of Living - For Better or For Worse</a></p><p>Is the distribution of income in the United States becoming more unequal? Does the average American today have a higher or lower standard of living than the average American of a generation ago? Will the next generation have a higher or lower standard of living?<br><font size="-10"><br /></font><font size="-3">Date Published: 12/09/1998<br />Grades: 9-12<br />Source: <a href='http://www.econedlink.org/' target='_blank'>EconEdLink.org</a></font></p><br><p><a href='http://www.econedlink.org/e885' target='_blank'>Graphing a Lorenz Curve and Calculating the Gini Coefficient</a></p><p>In this lesson, students receive raw data to construct a Lorenz Curve and calculate the Gini Coefficient. This lesson prepares AP Microeconomics students for the Advanced Placement exam. The teacher will briefly interpret the Gini Coefficient.<br><font size="-10"><br /></font><font size="-3">Date Published: 04/05/2010<br />Grades: 9-12<br />Source: <a href='http://www.econedlink.org/' target='_blank'>EconEdLink.org</a></font></p><br><p><a href='http://www.econedlink.org/e650' target='_blank'>Why does Brett Favre make $8.5 million per year?</a></p><p>What determines a person's salary? Why do professional athletes make so much money? People who work as firefighters, police officers or teachers are clearly more important to our society, yet they make much less money than jocks. What explains this?<br><font size="-10"><br /></font><font size="-3">Date Published: 06/06/2006<br />Grades: 9-12<br />Source: <a href='http://www.econedlink.org/' target='_blank'>EconEdLink.org</a></font></p><br><p><a href='http://www.econedlink.org/e318' target='_blank'>This Little Piggybank Went to Market</a></p><p>Students will learn that work is the source of income and that banks are places in which people save and secure money they have earned.<br><font size="-10"><br /></font><font size="-3">Date Published: 06/10/2003<br />Grades: K-2<br />Source: <a href='http://www.econedlink.org/' target='_blank'>EconEdLink.org</a></font></p><br><p><a href='http://www.econedlink.org/e177' target='_blank'>Nothing to Buy</a></p><p>Students compare the Soviet-era marketplace with present-day Russian marketplace.<br><font size="-10"><br /></font><font size="-3">Date Published: 11/01/2000<br />Grades: 3-5<br />Source: <a href='http://www.econedlink.org/' target='_blank'>EconEdLink.org</a></font></p><br>]]></resources>
<related>
<concept>68</concept>
<concept>28</concept>
</related>
<quiz>1</quiz>
</concept>
<concept>
<id>14</id>
<name>Inflation</name>
<category>1</category>
<definition><![CDATA[<p><b>Inflation</b> is an increase in the average <a href="event:function=defineGlossaryTerm,Price Level">price level</a> in the economy. A positive rate of <a href="event:function=defineGlossaryTerm,Inflation">inflation</a> does not mean that every single <a href="event:function=defineGlossaryTerm,Price">price</a> increases, nor that all prices increase by the same amount, nor that the price of some goods didn't fall. It represents an average price increase for the <a href="event:function=defineGlossaryTerm,Goods">goods</a> and <a href="event:function=defineGlossaryTerm,Services">services</a> in the economy. The <a href="event:function=defineGlossaryTerm,Consumer Price Index (CPI)">Consumer Price Index</a> is a measure of inflation that tells how much the price of a representative bundle of goods and services purchased by <a href="event:function=defineGlossaryTerm,Consumers">consumers</a> has increased. The GDP deflator is a measure of inflation that tells how much the price of all goods included in GDP has increased (GDP includes consumer goods and services and also machinery and equipment bought by <a href="event:function=defineGlossaryTerm,Firms">firms</a>, purchases of goods and services by government and the impact of <a href="event:function=defineGlossaryTerm,Exports">exports</a> and <a href="event:function=defineGlossaryTerm,Imports">imports</a>). </p> ]]></definition>
<lessons><![CDATA[<p>Below are <b>featured</b> lessons for teaching Inflation.</p><br><p class="tipHeading">High School Lessons</p><p>--------------------------------------------------------------------</p><p><a href="event:function=viewLesson,68108"><b>Lesson 5 - Monetary Policy in the Recent Financial Crisis</b></a><br><a href="event:function=viewPublication,140">Teaching Financial Crises</a></p><br><p class="smaller_text">Actions are taken by the Board of Governors of the Federal Reserve System (the Fed) to create a stable macroeconomy. Part 1 of the lesson places the student in the role of an economic analyst diagnosing the economy by viewing 2007-2009 data regard...</p><br><p>--------------------------------------------------------------------</p><p><a href="event:function=viewLesson,68107"><b>Lesson 4 - The Japan Comparison</b></a><br><a href="event:function=viewPublication,140">Teaching Financial Crises</a></p><br><p class="smaller_text">In this lesson, students play the role of economic advisors to the U.S. president. They learn about Japan's "Lost Decade," and then they compare economic data and policies to analyze the potential future of the U.S. economy.</p><br><p>--------------------------------------------------------------------</p><p><a href="event:function=viewLesson,67762"><b>Lesson 36: The No-Good Seventies</b></a><br><a href="event:function=viewPublication,105">Focus: Understanding Economics in U.S. History</a></p><br><p class="smaller_text">The students read an explanation of the causes of inflation and unemployment, with special reference to the economic problems of the 1970s. They analyze unemployment and inflation rates and use their analyses, together with information from anothe...</p><br><p>--------------------------------------------------------------------</p><p><a href="event:function=viewLesson,60260"><b>Lesson 10: Macroeconomic Stabilization Policies and Institutions</b></a><br><a href="event:function=viewPublication,39">Focus: Institutions and Markets</a></p><br><p class="smaller_text">This lesson begins by reviewing the discovery and adoption of Keynesian fiscal policies in the United States and other nations following World War II. Students then participate in several exercises to ascertain their understanding of appropriate ...</p><br><p>--------------------------------------------------------------------</p><p><a href="event:function=viewLesson,15432"><b>Lesson 11 - Money and Inflation</b></a><br><a href="event:function=viewPublication,2">Economics in Action: 14 Greatest Hits for Teaching High School Economics</a></p><br><p class="smaller_text">Students observe a simple demonstration to determine the functions that money performs. They next participate in two rounds of an auction illustrating how increases in the money supply lead to inflation. They view an active demonstration of the eq...</p><br><p>--------------------------------------------------------------------</p><p><a href="event:function=viewLesson,65720"><b>Lesson 4: Klips And Kupons</b></a><br><a href="event:function=viewPublication,63">Economies in Transition: Command to Market</a></p><br><p class="smaller_text">The students participate in the Klips and Kupons simulation. During the simulation, they discover how a change in the money supply can cause changes in the price level. They formalize this discovery by relating the equation of exchange to their ...</p><br> <p>--------------------------------------------------------------------</p><p><a href="event:function=viewLesson,865"><b><font color="#CC6666">Online Lesson:</font> How Much Does it Cost Now?</b></a><br><a href='http://www.econedlink.org/' target='_blank'>EconEdLink.org</a></p><br><p class="smaller_text">Students will use the FRED database to download the Consumer Price Index (CPI) and calculate the equivalent price of a product from an earlier time to the relative price today. Students will discuss the limits of using a weighted index and change...</p><br><p>--------------------------------------------------------------------</p><p><a href="event:function=viewLesson,776"><b><font color="#CC6666">Online Lesson:</font> Marketplace: The Argentina Barter Fair</b></a><br><a href='http://www.econedlink.org/' target='_blank'>EconEdLink.org</a></p><br><p class="smaller_text">In April 2002, Argentina's economic situation seemed to be getting worse and worse. Banks closed for nine days before reopening on April 29, 2002. How did Argentinians function during that time? Amy Radil of NPR reported on the flourishing barter ...</p><br><p>--------------------------------------------------------------------</p><p><a href="event:function=viewLesson,604"><b><font color="#CC6666">Online Lesson:</font> Was Babe Ruth Under Paid?</b></a><br><a href='http://www.econedlink.org/' target='_blank'>EconEdLink.org</a></p><br><p class="smaller_text">This lesson demonstrates a method for teaching students about inflation and the Consumer Price Index, using baseball players' salaries for purposes of illustration. Babe Ruth's salary from 1931 is adjusted to account for changes in the price leve...</p><br><p>--------------------------------------------------------------------</p><p><a href="event:function=viewLesson,615"><b><font color="#CC6666">Online Lesson:</font> What causes inflation?</b></a><br><a href='http://www.econedlink.org/' target='_blank'>EconEdLink.org</a></p><br><p class="smaller_text">This lesson explores different types of inflation and terms associated with this economic concept. You may have heard relatives talk about the good old days when a dollar would buy something. What happened to that dollar? Why won’t it buy...</p><br><p class="tipHeading">Middle School Lessons</p><p>--------------------------------------------------------------------</p><p><a href="event:function=viewLesson,15849"><b>Lesson 4 - Constructing and Using a Consumer Price Index</b></a><br><a href="event:function=viewPublication,3">Mathematics & Economics: Connections for Life - 6-8</a></p><br><p class="smaller_text">In this lesson, the students look at data for baby-sitting wages (a price for labor) and the price of movie tickets over time. They learn about the Consumer Price Index and how to construct a price index. They learn how a price index is used to co...</p><br><p>--------------------------------------------------------------------</p><p><a href="event:function=viewLesson,62636"><b>Lesson 6 - Inflation</b></a><br><a href="event:function=viewPublication,49">Focus: Middle School Economics</a></p><br><p class="smaller_text">In this lesson, students participate in two auction rounds to learn about inflation.</p><br> <p>--------------------------------------------------------------------</p><p><a href="event:function=viewLesson,515"><b><font color="#CC6666">Online Lesson:</font> Climbing the Savings Mountain</b></a><br><a href='http://www.econedlink.org/' target='_blank'>EconEdLink.org</a></p><br><p class="smaller_text">Students discover how saving money can be compared to a mountain climb. The climb can be fast or slow, safe or hazardous, scenic or thrilling. You will find out that there is more than one way to get to the top!</p><br><p class="tipHeading">Elementary Lessons</p><p>--------------------------------------------------------------------</p><p><a href="event:function=viewLesson,67936"><b>Lesson 15: The Babe and I</b></a><br><a href="event:function=viewPublication,116">Teaching Economics Using Children's Literature</a></p><br><p class="smaller_text">The story is about a young boy growing up in New York during the Great Depression. He learns that his father is selling apples to support the family. The boy decides to help support the family by becoming a "newsie" - a street corner newspaper boy...</p><br> <p>--------------------------------------------------------------------</p><p><a href="event:function=viewLesson,373"><b><font color="#CC6666">Online Lesson:</font> When Gas was a Quarter!</b></a><br><a href='http://www.econedlink.org/' target='_blank'>EconEdLink.org</a></p><br><p class="smaller_text">Why do things cost so much more now than they used to? Students will find out about inflation in the United States.</p><br>]]></lessons>
<tips><![CDATA[<p class="tipHeading">Tip #1</p><p>Inflation is caused by too much money chasing too few goods. This concept can be demonstrated in the classroom with an auction. Auction off some small item like a candy bar or a pencil. Give the students beans to use as money that can only be used for this auction. Keep increasing the number of beans, and see what happens to the price of the item during successive rounds of bidding. Each set of prices should be considerably higher than the last set of prices.</p><br><p class="tipHeading">Tip #2</p><p>Unanticipated inflation is usually portrayed as "bad," but it actually creates winners and losers. With the students explore who the winners (borrowers with fixed interest rate loans) are and who the losers (savers and people on fixed incomes) are and why. The reason inflation is so destructive is that the winners think they have been clever while the losers feel they have been hurt by forces out of their control. This conflict ultimately can tear society apart. In the words of John Maynard Keynes, "there is no subtler, no surer means of overturning the existing basis of society than to debauch the currency."</p><br><p class="tipHeading">Tip #3</p><p>To show the harmful effects of inflation, have the students study the effects of hyperinflation in Germany after World War I or in Argentina in the 1980s. A more recent example of hyperinflation would be Zimbabwe.</p><br>]]></tips>
<resources><![CDATA[<p><b>Interactive tools:</b><br /></p><p><font color="#CC6666">Video</font> <a href='http://www.econedlink.org/i162' target='_blank'>Making Sen$e with Paul Solman: Tracking Inflation: How Fast Are Prices Rising?</a></p><p>As part of his continuing coverage of Making Sense of financial news, Paul Solman reports on the growing rate of inflation and how Americans are dealing with the extra costs. According to the government's latest figures, prices made the biggest ju...<br><font size="-10"><br /></font><font size="-3">Date Published: 05/29/2011<br>Grades: 9-12<br />Source: <a href='http://www.econedlink.org/' target='_blank'>EconEdLink.org</a></font></p><br><p><font color="#CC6666">Video</font> <a href='http://www.econedlink.org/i41' target='_blank'>Making Sen$e with Paul Solman: Efforts to Revive Economy Test Inflation Theories</a></p><p>The threat of inflation is testing the Federal Reserve as it works to determine how to unwind emergency moves taken during the financial crisis.<br><font size="-10"><br /></font><font size="-3">Date Published: 08/21/2009<br>Grades: 9-12<br />Source: <a href='http://www.econedlink.org/' target='_blank'>EconEdLink.org</a></font></p><br><p><font color="#CC6666">Video</font> <a href='http://www.econedlink.org/i273' target='_blank'>Making Sen$e with Paul Solman: America's Historical Struggle With Debt and the Role of Federal Government</a></p><p>Between paying now or paying later, Americans have just about always preferred debt to taxes. Paul Solman talks to Simon Johnson of the MIT Sloan School of Management about his new book "White House Burning," which chronicles the history -- includ...<br><font size="-10"><br /></font><font size="-3">Date Published: 12/12/2012<br>Grades: 9-12<br />Source: <a href='http://www.econedlink.org/' target='_blank'>EconEdLink.org</a></font></p><br><p><font color="#CC6666">Video</font> <a href='http://www.econedlink.org/i205' target='_blank'>Inflation</a></p><p>This video teaches the concept of Inflation, which is an increase in the average price level in the economy.<br><font size="-10"><br /></font><font size="-3">Date Published: 07/12/2012<br>Grades: 6-8, 9-12<br />Source: <a href='http://www.econedlink.org/' target='_blank'>EconEdLink.org</a></font></p><br><p><font color="#CC6666">Video</font> <a href='http://www.econedlink.org/i206' target='_blank'>Monetary Policy and the Federal Reserve</a></p><p>This video teaches the concepts of Monetary Policy and the Federal Reserve. Monetary policy involves regulating the money supply, banks and the overall financial system. Monetary policy is conducted by a central bank, which in the United States is...<br><font size="-10"><br /></font><font size="-3">Date Published: 07/12/2012<br>Grades: 3-5, 6-8, 9-12<br />Source: <a href='http://www.econedlink.org/' target='_blank'>EconEdLink.org</a></font></p><br><p>-------------------------------------</p><p><b>Lessons:</b></p><br><p><a href='http://www.econedlink.org/e1010' target='_blank'>Avatar, King of the Box Office?</a></p><p>On January 26, 2010, the film Avatar officially topped Titanic as the top-grossing film of all-time at the box office. However, the following day, Forbes.com published an article entitled Is Avatar Really King of the Box Office? The article explains how using calculations such as the Consumer Price Index (CPI), one can show how the film Gone With the Wind has grossed more when the value of the box office receipts are adjusted for inflation.<br><font size="-10"><br /></font><font size="-3">Date Published: 10/27/2011<br />Grades: 9-12<br />Source: <a href='http://www.econedlink.org/' target='_blank'>EconEdLink.org</a></font></p><br><p><a href='http://www.econedlink.org/e48' target='_blank'>Let's Talk Turkey: The Cost of Thanksgiving Dinner</a></p><p>How does your family celebrate Thanksgiving? Are you joined by friends and/or family for a special feast? What do you eat? Most American families celebrate Thanksgiving by cooking turkey. According to EatTurkey.com, approx. 88 percent of U.S. households eat turkey on Thanksgiving at an average weight of 16 lbs a turkey that adds up to 736 million pounds that will be eaten this Thanksgiving.<br><font size="-10"><br /></font><font size="-3">Date Published: 11/16/1999<br />Grades: 9-12<br />Source: <a href='http://www.econedlink.org/' target='_blank'>EconEdLink.org</a></font></p><br><p><a href='http://www.econedlink.org/e865' target='_blank'>How Much Does it Cost Now?</a></p><p>Students will use the FRED database to download the Consumer Price Index (CPI) and calculate the equivalent price of a product from an earlier time to the relative price today. Students will discuss the limits of using a weighted index and changes in the quality of products when calculating the relative prices of goods from two time periods.<br><font size="-10"><br /></font><font size="-3">Date Published: 06/03/2010<br />Grades: 9-12<br />Source: <a href='http://www.econedlink.org/' target='_blank'>EconEdLink.org</a></font></p><br><p><a href='http://www.econedlink.org/e373' target='_blank'>When Gas was a Quarter!</a></p><p>Why do things cost so much more now than they used to? Students will find out about inflation in the United States.<br><font size="-10"><br /></font><font size="-3">Date Published: 04/08/2003<br />Grades: 3-5<br />Source: <a href='http://www.econedlink.org/' target='_blank'>EconEdLink.org</a></font></p><br><p><a href='http://www.econedlink.org/e604' target='_blank'>Was Babe Ruth Under Paid?</a></p><p>This lesson demonstrates a method for teaching students about inflation and the Consumer Price Index, using baseball players' salaries for purposes of illustration. Babe Ruth's salary from 1931 is adjusted to account for changes in the price level and is then compared to the salaries of those playing major league baseball players today.<br><font size="-10"><br /></font><font size="-3">Date Published: 01/12/2006<br />Grades: 9-12<br />Source: <a href='http://www.econedlink.org/' target='_blank'>EconEdLink.org</a></font></p><br>]]></resources>
<related>
<concept>15</concept>
<concept>60</concept>
</related>
<quiz>1</quiz>
</concept>
<concept>
<id>64</id>
<name>Insurance</name>
<category>4</category>
<definition><![CDATA[<p>The purchase of <a href="event:function=defineGlossaryTerm,Insurance"><b>insurance</b></a> involves paying an amount called a <a href="event:function=defineGlossaryTerm,Premium">premium</a> at regular intervals, with the understanding that if negative events occur, the insurance company will pay certain <a href="event:function=defineGlossaryTerm,Costs">costs</a>. For example, health insurance provides payments to health-care providers if you are sick. Life insurance provides a payment to your descendants if you die. Car insurance provides payments for damages caused in an auto accident. Homeowner's insurance pays for home repairs in the case of fire or storm damage. </p> <br><p>Insurance works on the principle that in a large group of people historical experience allows one to predict with some accuracy how many of them will suffer a negative event each year--but no one can say in advance exactly who in the group will suffer the negative events. Individuals who are averse to taking <a href="event:function=defineGlossaryTerm,Risk">risks</a> prefer to pay an insurance premium, and be protected against the high costs of negative events, instead of waiting to find out if they are unlucky enough to suffer the negative events. The great irony of insurance is that it is a purchase one hopes never to <a href="event:function=defineGlossaryTerm,Benefit">benefit</a> from--since that would mean that the negative event has occurred.</p>]]></definition>
<lessons><![CDATA[<p>Below are <b>featured</b> lessons for teaching Insurance.</p><br><p class="tipHeading">High School Lessons</p><p>--------------------------------------------------------------------</p><p><a href="event:function=viewLesson,68110"><b>Lesson 7 - The Instruments and Institutions of Modern Financial Markets</b></a><br><a href="event:function=viewPublication,140">Teaching Financial Crises</a></p><br><p class="smaller_text">Students work in small groups to make flash cards to display terms commonly used in modern financial markets. Each group of students begins by learning one group of terms. The students pass their flash cards from group to group until everyone has ...</p><br><p>--------------------------------------------------------------------</p><p><a href="event:function=viewLesson,65743"><b>Lesson 4 - Why Renter's Insurance?</b></a><br><a href="event:function=viewPublication,100">Virtual Economics: Insurance Lessons</a></p><br><p class="smaller_text">This lesson focuses on a question that many of your students will face in college and/or in their first job as they live in apartments: Should they buy renter's insurance? Many students do not know what renter's insurance covers or even that it is...</p><br><p>--------------------------------------------------------------------</p><p><a href="event:function=viewLesson,65742"><b>Lesson 3 - Everything You Ever Wanted to Know About Automobile Insurance</b></a><br><a href="event:function=viewPublication,100">Virtual Economics: Insurance Lessons</a></p><br><p class="smaller_text">The topic of automobile insurance is important to most high school students because of their interest in owning and operating a car or truck. But many teenagers think vehicle insurance is esoteric and mysterious. This lesson provides some basic in...</p><br><p>--------------------------------------------------------------------</p><p><a href="event:function=viewLesson,65741"><b>Lesson 2 - The Basics of Life Insurance</b></a><br><a href="event:function=viewPublication,100">Virtual Economics: Insurance Lessons</a></p><br><p class="smaller_text">This lesson focuses on basic information that everyone should know and be able to apply when they purchase life insurance. This knowledge is especially important for recent high school graduates who are approached to buy life insurance.</p><br><p>--------------------------------------------------------------------</p><p><a href="event:function=viewLesson,65740"><b>Lesson 1 - Why Insurance and How Does It Work?</b></a><br><a href="event:function=viewPublication,100">Virtual Economics: Insurance Lessons</a></p><br><p class="smaller_text">This lesson uses readings and group work to describe the risks that are a part of everyone's life. It then elaborates on five ways to handle risk. Two of these ways are to share and transfer risk, which is the purpose of insurance.</p><br> <p>--------------------------------------------------------------------</p><p><a href="event:function=viewLesson,312"><b><font color="#CC6666">Online Lesson:</font> Break a Leg</b></a><br><a href='http://www.econedlink.org/' target='_blank'>EconEdLink.org</a></p><br><p class="smaller_text">In this lesson students will learn about the basic components and terminology of individual health insurance. Students will make decisions about the value of insurance protection and you will identify trends in the cost of medical care in the Unit...</p><br><p>--------------------------------------------------------------------</p><p><a href="event:function=viewLesson,354"><b><font color="#CC6666">Online Lesson:</font> Marketplace: To Show or Not To Show</b></a><br><a href='http://www.econedlink.org/' target='_blank'>EconEdLink.org</a></p><br><p class="smaller_text">This lesson complements an NPR Marketplace segment exploring the effects of the rising costs of insurance for high-profile art exhibits since September 11.</p><br><p class="tipHeading">Elementary Lessons</p><p>--------------------------------------------------------------------</p><p><a href="event:function=viewLesson,67942"><b>Lesson 21: Lunch Money</b></a><br><a href="event:function=viewPublication,116">Teaching Economics Using Children's Literature</a></p><br><p class="smaller_text">Greg is a sixth grader with a love for money. He had his first lemonade stand in second grade and is always looking for new ways to make money. Greg recently discovered that most students bring extra money to school each day, so he has decided it'...</p><br> ]]></lessons>
<tips><![CDATA[<p class="tipHeading">Tip #1</p><p>Explain to your students that the purpose of insurance is to share risk. You don't buy insurance to make money, but instead to guard against loss. Therefore, buying insurance makes the most sense when the potential loss is great and there is a significant probability of loss over the long term. It does not make sense to insure against losses that are small or that will definitely happen because risk does not have to be shared in these circumstances.</p><br><p class="tipHeading">Tip #2</p><p>Ask your students which of the following risks they would insure against and why:<li>Risk that your CD player will be stolen</li><li>Risk that you will have a cavity in a tooth</li><li>Risk that your car will be stolen</li><li>Risk that you will get cancer</li>Then discuss the idea that the purpose of insurance is to share risk.</p><br><p class="tipHeading">Tip #3</p><p>Students have a difficult time comparing the costs of auto insurance because they do not compare similar coverages. Discuss which coverages are most necessary, and then decide which coverages to shop for. Finally, have the students compare prices for those coverages with three different insurance companies. What are the differences in price for the same coverage? Should price be an insurance buyer's only concern?</p><br><p class="tipHeading">Tip #4</p><p>Many students will be approached about buying life insurance when they graduate. They might understand the concept better if it were called "death insurance" because the main purpose of life insurance is to replace lost income if a family's wage earner dies. When the students view life insurance in this way, they will understand that they don't need much of it yet.</p><br>]]></tips>
<resources><![CDATA[<p><b>Interactive tools:</b><br /></p><p><font color="#CC6666">Video</font> <a href='http://www.econedlink.org/i231' target='_blank'>Insurance</a></p><p>This video teaches the concept of Insurance. The purchase of insurance involves paying an amount called a premium at regular intervals, with the understanding that if negative events occur, the insurance company will pay certain costs.<br><font size="-10"><br /></font><font size="-3">Date Published: 07/12/2012<br>Grades: 6-8, 9-12<br />Source: <a href='http://www.econedlink.org/' target='_blank'>EconEdLink.org</a></font></p><br><p><font color="#CC6666">Video</font> <a href='http://www.econedlink.org/i270' target='_blank'>Making Sen$e with Paul Solman: Climate Change Causes Insurers to Rethink Price of Risk After Hurricane Sandy</a></p><p>The insurance industry looks at historical data, old and new, in order to assess the risk for potential disasters and put a price on premiums. But when Sandy hit the Northeast, some insurance companies reconsidered if they priced insurance high en...<br><font size="-10"><br /></font><font size="-3">Date Published: 11/21/2012<br>Grades: 9-12<br />Source: <a href='http://www.econedlink.org/' target='_blank'>EconEdLink.org</a></font></p><br><p><font color="#CC6666">Video</font> <a href='http://www.econedlink.org/i269' target='_blank'>Making Sen$e with Paul Solman: Future Unclear for Superstorm Sandy Victims Dealing with Insurance Woes</a></p><p>Despite a history of hurricanes, there were many storm victims in New York without flood insurance thinking the risk for damage was low. But after Sandy hit, many residents are faced now with huge damage bills and no idea how they'll recover. Econ...<br><font size="-10"><br /></font><font size="-3">Date Published: 11/19/2012<br>Grades: 9-12<br />Source: <a href='http://www.econedlink.org/' target='_blank'>EconEdLink.org</a></font></p><br><p><font color="#CC6666">Video</font> <a href='http://www.econedlink.org/i263' target='_blank'>Making Sen$e of Health Care: Competing Claims on Campaign Trail About Reform</a></p><p>Paul Solman compares and contrasts "Obamacare" policy with health care reform proposals from Mitt Romney. Economists on both sides of the political debate discuss increasing efficiency, technological innovation, market competition and vouchers.<br><font size="-10"><br /></font><font size="-3">Date Published: 09/11/2012<br>Source: <a href='http://www.econedlink.org/' target='_blank'>EconEdLink.org</a></font></p><br><p><font color="#CC6666">Video</font> <a href='http://www.econedlink.org/i232' target='_blank'>Money Management/Budgeting</a></p><p>This video teaches the concepts of Money Management and Budgeting. Budgeting refers to drawing up a plan for how available funds will be spent. Budgeting is sometimes called money management, since it involves clarifying decisions about how availa...<br><font size="-10"><br /></font><font size="-3">Date Published: 07/12/2012<br>Grades: 3-5, 6-8, 9-12<br />Source: <a href='http://www.econedlink.org/' target='_blank'>EconEdLink.org</a></font></p><br><p>-------------------------------------</p><p><b>Lessons:</b></p><br><p><a href='http://www.econedlink.org/e1035' target='_blank'>Understanding a Balance Sheet</a></p><p>A balance sheet shows the assets, liabilities, and net worth for a business on a given day. This business document is one of the major documents used in evaluating a business. Students will learn the components of a balance sheet by working through many problems to strengthen their understanding.<br><font size="-10"><br /></font><font size="-3">Date Published: 01/23/2012<br />Grades: 9-12<br />Source: <a href='http://www.econedlink.org/' target='_blank'>EconEdLink.org</a></font></p><br><p><a href='http://www.econedlink.org/e745' target='_blank'>How Labor Got Its Day</a></p><p>If you asked students what comes to mind first when they think of Labor Day, what do you think they would say? The last days of summer? A family picnic? Shopping the Labor Day sales? The purpose of this lesson is to broaden and deepen student understanding of the Labor Day holiday. Students will learn why workers organized unions during the nineteenth century to fight for higher pay and better working conditions. They will discover that unions help balance the power between workers and employers—yielding a better life for many workers and their families today. This is a great lesson to do just before Labor Day. If your school doesn’t begin till after the holiday, consider doing it on May 1—the International Worker’s Rights Day!<br><font size="-10"><br /></font><font size="-3">Date Published: 02/04/2008<br />Grades: 3-5<br />Source: <a href='http://www.econedlink.org/' target='_blank'>EconEdLink.org</a></font></p><br><p><a href='http://www.econedlink.org/e354' target='_blank'>Marketplace: To Show or Not To Show</a></p><p>This lesson complements an NPR Marketplace segment exploring the effects of the rising costs of insurance for high-profile art exhibits since September 11.<br><font size="-10"><br /></font><font size="-3">Date Published: 03/11/2004<br />Grades: 6-8, 9-12<br />Source: <a href='http://www.econedlink.org/' target='_blank'>EconEdLink.org</a></font></p><br><p><a href='http://www.econedlink.org/e312' target='_blank'>Break a Leg</a></p><p>In this lesson students will learn about the basic components and terminology of individual health insurance. Students will make decisions about the value of insurance protection and you will identify trends in the cost of medical care in the United States.<br><font size="-10"><br /></font><font size="-3">Date Published: 05/23/2005<br />Grades: 9-12<br />Source: <a href='http://www.econedlink.org/' target='_blank'>EconEdLink.org</a></font></p><br>]]></resources>
<related>
<concept>43</concept>
<concept>49</concept>
</related>
<quiz>1</quiz>
</concept>
<concept>
<id>28</id>
<name>Market Failures</name>
<category>2</category>
<definition><![CDATA[<p>A <a href="event:function=defineGlossaryTerm,Markets">market</a> succeeds when it brings together a willing buyer and willing seller to make a mutually beneficial transaction in a way that satisfies the parties involved. However, there are certain well-recognized conditions under which <b>market failure</b> occurs; this means either that a market transaction affects third parties not involved in the transaction or that a market has difficulty in providing certain kinds of <a href="event:function=defineGlossaryTerm,Product">products</a>.</p><br><p>Here are some examples of market failure. First, <a href="event:function=defineGlossaryTerm,Externalities">externalities</a> are situations in which a market transaction affects a third party who is not part of the transaction. A classic example is pollution, where people who do not purchase the good whose <a href="event:function=defineGlossaryTerm,Production">production</a> created the pollution must nevertheless face polluted air or water. Second, a <a href="event:function=defineGlossaryTerm,Public Goods">public good</a> is a good where it is difficult to charge people for using it, and where one person's use of the good does not diminish the good for others. An example is national defense or police protection in public places. Because it is hard for private <a href="event:function=defineGlossaryTerm,Firms">firms</a> to charge people for these <a href="event:function=defineGlossaryTerm,Services">services</a>, markets often do a poor job of providing them. Third, a <a href="event:function=defineGlossaryTerm,Monopoly">monopoly</a> firm that operates without <a href="event:function=defineGlossaryTerm,Competition">competition</a>, and thus has the power to increase the <a href="event:function=defineGlossaryTerm,Price">prices</a> it charges to <a href="event:function=defineGlossaryTerm,Consumers">consumers</a>, is an example of market failure. Imperfect information is often cited as a market failure. Ideally all market participants would have perfect information, and it is often argued that markets fail when buyers and sellers have imperfect information. But buyers and sellers always have less than perfect information. Indeed, any attempt to acquire perfect information would be inefficient because it would soon begin costing more than it was worth. Also, it should be emphasized that the prices that emerge from market <a href="event:function=defineGlossaryTerm,Exchange">exchanges</a> provide buyers and sellers with far more information relevant to their decisions than would otherwise be available.</p>]]></definition>
<lessons><![CDATA[<p>Below are <b>featured</b> lessons for teaching Market Failures.</p><br><p class="tipHeading">High School Lessons</p><p>--------------------------------------------------------------------</p><p><a href="event:function=viewLesson,68106"><b>Lesson 3 - Manias, Bubbles, and Panics in World History</b></a><br><a href="event:function=viewPublication,140">Teaching Financial Crises</a></p><br><p class="smaller_text">This lesson addresses the psychology surrounding speculative manias, often referred to as bubbles. The class will be introduced to some of the theories behind bubbles and apply those concepts to the recent housing bubble. Students will then be int...</p><br><p>--------------------------------------------------------------------</p><p><a href="event:function=viewLesson,68030"><b>Lesson 4 - What Are the Economic Functions of Government?</b></a><br><a href="event:function=viewPublication,118">Focus: Understanding Economics in Civics and Government</a></p><br><p class="smaller_text">The teacher introduces six economic functions of government in a brief lecture. In a guided practice activity, the students classify newspaper headlines according to the six functions. A brief reading introduces "liberal" and "conservative" views ...</p><br><p>--------------------------------------------------------------------</p><p><a href="event:function=viewLesson,67642"><b>Lesson 7 - Globalization and the Environment</b></a><br><a href="event:function=viewPublication,109">Focus: Globalization</a></p><br><p class="smaller_text">A demonstration activity in which teams of students simulate a production process by shelling peanuts illustrates how "spillover" problems can affect people who are neither producers nor consumers of the product, sometimes including people who liv...</p><br><p>--------------------------------------------------------------------</p><p><a href="event:function=viewLesson,60257"><b>Lesson 7: Public Goods and Externalities</b></a><br><a href="event:function=viewPublication,39">Focus: Institutions and Markets</a></p><br><p class="smaller_text">This lesson gives students an opportunity to identify the nature of public and private goods, classify them according to the characteristics of rivalry and excludability, experience the impact of free riders and other external benefits and costs, ...</p><br><p>--------------------------------------------------------------------</p><p><a href="event:function=viewLesson,62483"><b>Lesson 11: The Lancaster Landfill</b></a><br><a href="event:function=viewPublication,72">Geography: Focus on Economics</a></p><br><p class="smaller_text">Students participate in a simulated town meeting called to consider proposed solutions to the problem of groundwater contamination. Hazardous waste accumulated in a landfill over many years is creating the problem. The landfill is no longer in u...</p><br> <p>--------------------------------------------------------------------</p><p><a href="event:function=viewLesson,764"><b><font color="#CC6666">Online Lesson:</font> Marketplace: Economy of Architecture</b></a><br><a href='http://www.econedlink.org/' target='_blank'>EconEdLink.org</a></p><br><p class="smaller_text">In March 2004, Andrew Haeg reported that in this age of globalization, great cultural centers have become essential to a city's economic survival. The arts can even put cities like Milwaukee on the map.</p><br><p>--------------------------------------------------------------------</p><p><a href="event:function=viewLesson,582"><b><font color="#CC6666">Online Lesson:</font> New Sense, Inc. vs. Fish 'Till U Drop or Coase Vs. Pigou</b></a><br><a href='http://www.econedlink.org/' target='_blank'>EconEdLink.org</a></p><br><p class="smaller_text">Hot debate and arguments galore whirl around this question: "Which economic approach is the most efficient and fair to resolve utility issues surrounding the use of common or public property?" This lesson will explore, examine and analy...</p><br><p>--------------------------------------------------------------------</p><p><a href="event:function=viewLesson,273"><b><font color="#CC6666">Online Lesson:</font> Why cities provide tax breaks even when they are strapped for revenue</b></a><br><a href='http://www.econedlink.org/' target='_blank'>EconEdLink.org</a></p><br><p class="smaller_text">Like the state and federal government, local governments offer tax incentives to businesses to help solve economic and/or environmental problems. In this lesson students will explore the web sites of three different cities and determine what ...</p><br><p class="tipHeading">Middle School Lessons</p><p>--------------------------------------------------------------------</p><p><a href="event:function=viewLesson,67915"><b>Unit 2: Trees and Forests</b></a><br><a href="event:function=viewPublication,107">Energy, Economics, and the Environment: Case Studies and Teaching Activities for Elementary School</a></p><br><p class="smaller_text">Trees and forests are a vital natural resource and affect our lives in innumerable ways. Therefore, it is very important that we learn how to manage our forest resource effectively. Fortunately, forest management in the United States has improved ...</p><br><p>--------------------------------------------------------------------</p><p><a href="event:function=viewLesson,65764"><b>Lesson 10 - Why Drive When You Can Ride?</b></a><br><a href="event:function=viewPublication,95">Economics and the Environment: Ecodetectives</a></p><br><p class="smaller_text">The students examine data showing that many Americans prefer to drive their own automobiles rather than use mass public transit. They analyze this preference by reference to the costs and benefits of driving. In light of the external costs generat...</p><br> ]]></lessons>
<tips><![CDATA[<p class="tipHeading">Tip #1</p><p>Use simple examples of positive and negative externalities to illustrate market failures. A simple positive externality is a flu shot. The person who receives the shot receives the benefit of the drug's protection and the cost of pain. Other people do not pay the cost but do receive the benefit because fewer people spread the flu. A simple negative externality is cigarette smoking. The person who smokes benefits, but other people nearby have costs associated with secondhand smoke.</p><br><p class="tipHeading">Tip #2</p><p>Pollution and pollution control are an example of a negative externality and of ways to correct it. A polluter receives the benefit of polluting because its costs are lower while other people pay those costs. The key to correcting pollution is to make the polluter pay the costs. This can be done by direct controls such as taxes and regulations or by the assignment of property rights.</p><br>]]></tips>
<resources><![CDATA[<p><b>Interactive tools:</b><br /></p><p><font color="#CC6666">Video</font> <a href='http://www.econedlink.org/i215' target='_blank'>Market Failures</a></p><p>This video teaches the concept of Market Failures. There are certain well-recognized conditions under which market failure occurs; this means either that a market transaction affects third parties not involved in the transaction or that a market h...<br><font size="-10"><br /></font><font size="-3">Date Published: 07/12/2012<br>Grades: 6-8, 9-12<br />Source: <a href='http://www.econedlink.org/' target='_blank'>EconEdLink.org</a></font></p><br><p><font color="#CC6666">Video</font> <a href='http://www.econedlink.org/i214' target='_blank'>Income Distribution</a></p><p>This video teaches the concept of Income Distribution. Income distribution refers to how the total income earned ends up divided over members of the economy.<br><font size="-10"><br /></font><font size="-3">Date Published: 07/12/2012<br>Grades: 6-8, 9-12<br />Source: <a href='http://www.econedlink.org/' target='_blank'>EconEdLink.org</a></font></p><br><p><font color="#CC6666">Video</font> <a href='http://www.econedlink.org/i239' target='_blank'>Making Sen$e with Paul Solman: Benefit Corporations Aim to Make a Profit -- and a Positive Impact REPORT</a></p><p>Seven states have passed legislation officially recognizing companies with a conscience. Called benefit corporations, or B Corps, the firms strive to make a positive impact on society while also turning a profit. Economics correspondent Paul Solma...<br><font size="-10"><br /></font><font size="-3">Date Published: 02/29/2012<br>Grades: 9-12<br />Source: <a href='http://www.econedlink.org/' target='_blank'>EconEdLink.org</a></font></p><br><p><font color="#CC6666">Video</font> <a href='http://www.econedlink.org/i86' target='_blank'>Making Sen$e with Paul Solman: Economists Examine Potential for Longer Recession</a></p><p>Paul Solman talks to two economists about recent market instability and the possibility of a double-dip recession.<br><font size="-10"><br /></font><font size="-3">Date Published: 06/15/2010<br>Grades: 9-12<br />Source: <a href='http://www.econedlink.org/' target='_blank'>EconEdLink.org</a></font></p><br><p><font color="#CC6666">Video</font> <a href='http://www.econedlink.org/i79' target='_blank'>Making Sen$e with Paul Solman: Winners and Losers of Florida's Foreclosure Crisis</a></p><p>Paul Solman kicks off the Spotlight series with a report from Florida on people who have lost their homes to foreclosure.<br><font size="-10"><br /></font><font size="-3">Date Published: 04/12/2010<br>Grades: 9-12<br />Source: <a href='http://www.econedlink.org/' target='_blank'>EconEdLink.org</a></font></p><br><p>-------------------------------------</p><p><b>Lessons:</b></p><br><p><a href='http://www.econedlink.org/e966' target='_blank'>Green Eggs and ...Economics?</a></p><p>Economic concepts are often found in places students have never considered, like children’s literature. In this lesson, students will explore the various economic concepts addressed in five of Dr. Seuss' most popular books: The Cat in the Hat; Green Eggs and Ham; The Lorax; Oh, the Places You’ll Go! and Horton Hears a Who! This lesson assumes the students already have some knowledge of basic microeconomic concepts. Therefore, it would be best utilized as a review or unit summary to reinforce the concepts you have already covered.<br><font size="-10"><br /></font><font size="-3">Date Published: 01/19/2012<br />Grades: 9-12<br />Source: <a href='http://www.econedlink.org/' target='_blank'>EconEdLink.org</a></font></p><br><p><a href='http://www.econedlink.org/e773' target='_blank'>Marketplace: Doing Business in Afghanistan</a></p><p>In May 2002, delegates from governments, international companies, and financial institutions met at a United Nations conference in Tehran to discuss the reconstruction of Afghanistan. Afghanistan's officials say that to create a viable economy and a stable society, the country must recreate basic infrastructures --and it requires foreign investment to do so. But will businesses want to invest in Afghanistan? Correspondent Borzou Daragahi recently traveled to Afghanistan's business centers to see what life is like for the foreign entrepreneur.<br><font size="-10"><br /></font><font size="-3">Date Published: 02/26/2009<br />Grades: 6-8, 9-12<br />Source: <a href='http://www.econedlink.org/' target='_blank'>EconEdLink.org</a></font></p><br><p><a href='http://www.econedlink.org/e764' target='_blank'>Marketplace: Economy of Architecture</a></p><p>In March 2004, Andrew Haeg reported that in this age of globalization, great cultural centers have become essential to a city's economic survival. The arts can even put cities like Milwaukee on the map.<br><font size="-10"><br /></font><font size="-3">Date Published: 01/21/2009<br />Grades: 6-8, 9-12<br />Source: <a href='http://www.econedlink.org/' target='_blank'>EconEdLink.org</a></font></p><br><p><a href='http://www.econedlink.org/e759' target='_blank'>Marketplace: School Competition</a></p><p>In June 2002, the Supreme Court ruled that Cleveland's system of giving students vouchers to attend private or religious schools did not violate the constitutional separation of church and state. In this lesson, students listen to an audio file about school vouchers creating market competition for public schools in June 2002. Students will identify the story's major concepts and their supporting details using an interactive note-taker.<br><font size="-10"><br /></font><font size="-3">Date Published: 07/15/2008<br />Grades: 9-12<br />Source: <a href='http://www.econedlink.org/' target='_blank'>EconEdLink.org</a></font></p><br><p><a href='http://www.econedlink.org/e582' target='_blank'>New Sense, Inc. vs. Fish 'Till U Drop or Coase Vs. Pigou</a></p><p>Hot debate and arguments galore whirl around this question: "Which economic approach is the most efficient and fair to resolve utility issues surrounding the use of common or public property?" This lesson will explore, examine and analyze this perplexing question by engaging in an open-ended role play simulation.<br><font size="-10"><br /></font><font size="-3">Date Published: 08/05/2005<br />Grades: 9-12<br />Source: <a href='http://www.econedlink.org/' target='_blank'>EconEdLink.org</a></font></p><br>]]></resources>
<related>
<concept>27</concept>
</related>
<quiz>1</quiz>
</concept>
<concept>
<id>26</id>
<name>Markets and Prices</name>
<category>2</category>
<definition><![CDATA[<p>A <b>market</b> refers to a group of buyers and sellers for a given <a href="event:function=defineGlossaryTerm,Goods">good</a> or <a href="event:function=defineGlossaryTerm,Services">service</a>. A market often does not occur at a single physical location. For example, the market for gasoline includes gas stations that sell and drivers that buy in different locations.</p><br><p>The <b><a href="event:function=defineGlossaryTerm,Price">price</a></b> is the amount of <a href="event:function=defineGlossaryTerm,Money">money</a> needed to buy a particular good or service. In a market, the price and quantity exchanged are determined by the interaction of <a href="event:function=defineGlossaryTerm,Demand">demand </a>and <a href="event:function=defineGlossaryTerm,Supply">supply</a>. Changes in demand or supply alter the price as well as the quantity bought and sold at that price. Prices provide <a href="event:function=defineGlossaryTerm,Incentive">incentives</a> to both buyers and sellers. For example, if poor weather in Brazil causes a reduction in the supply of coffee and an increase in the price of coffee, then at least some buyers of coffee will react to the higher price by reducing the amount of coffee they drink or by substituting some other drink. If the demand for fresh fruits and vegetables increases, causing the price to rise, then at least some suppliers will react to the higher price by producing more. In this way, flexible and adjustable prices are messengers in a <a href="event:function=defineGlossaryTerm,Market Economy">market economy</a>, revealing information on supply and demand conditions and providing incentives for market participants to respond appropriately to that information.</p><br><p>Prices are Adam Smith's "<a href="event:function=defineGlossaryTerm,Invisible Hand">invisible hand</a>" that brings the actions of self-interested individuals in harmony with the general prosperity of a society. Flexible prices bring the interests of <a href="event:function=defineGlossaryTerm,Consumers">consumers</a> and <a href="event:function=defineGlossaryTerm,Producers">producers</a> together.</p>]]></definition>
<lessons><![CDATA[<p>Below are <b>featured</b> lessons for teaching Markets and Prices.</p><br><p class="tipHeading">High School Lessons</p><p>--------------------------------------------------------------------</p><p><a href="event:function=viewLesson,60251"><b>Lesson 1: Markets and the Market System</b></a><br><a href="event:function=viewPublication,39">Focus: Institutions and Markets</a></p><br><p class="smaller_text">This lesson introduces students to the primary economic institution in a market economy, markets. As described in the introductory essay to this volume, markets are an institution that emerges spontaneously from the interaction of self-interested...</p><br><p>--------------------------------------------------------------------</p><p><a href="event:function=viewLesson,15428"><b>Lesson 7 - A Market in Wheat</b></a><br><a href="event:function=viewPublication,2">Economics in Action: 14 Greatest Hits for Teaching High School Economics</a></p><br><p class="smaller_text">Students participate as buyers or sellers in a simulation that shows how a competitive market works. They determine individual profits or losses from market transactions. They use data from the simulation to plot and interpret a graph showing supp...</p><br><p>--------------------------------------------------------------------</p><p><a href="event:function=viewLesson,20817"><b>Lesson 3: Equilibrium: Determining Prices and Quantities</b></a><br><a href="event:function=viewPublication,11">Mathematics & Economics: Connections for Life - 9-12</a></p><br><p class="smaller_text">Supply and demand affect the prices people pay and the quantities they exchange in a market economy. Equilibrium is said to occur at the point at which quantity supplied equals quantity demanded. This point is at the intersection of the supply and...</p><br><p>--------------------------------------------------------------------</p><p><a href="event:function=viewLesson,62513"><b>Lesson 8- Adam Smith And The Market Economy</b></a><br><a href="event:function=viewPublication,70">World History: Focus on Economics</a></p><br><p class="smaller_text">Students read a passage describing Adam Smith's concept of individual self-interest. Next, groups of students act as competitive producers or as investors in a simulation. Finally, they answer in writing several questions designed to debrief the...</p><br><p>--------------------------------------------------------------------</p><p><a href="event:function=viewLesson,62444"><b>Lesson 4 - A Student's Potential in the Labor Market: It's a Matter of Supply and Demand</b></a><br><a href="event:function=viewPublication,73">Personal Decision Making: Focus on Economics</a></p><br><p class="smaller_text">Students engage in two labor market simulations. One market is characterized by high wages and specific skill requirements; the other is characterized by low wages and low skill requirements. Students evaluate their own skills and plan ways to i...</p><br><p>--------------------------------------------------------------------</p><p><a href="event:function=viewLesson,62445"><b>Lesson 5 - Price As A Rationing Method: How Does A Market Work?</b></a><br><a href="event:function=viewPublication,73">Personal Decision Making: Focus on Economics</a></p><br><p class="smaller_text">Students use the price mechanism to allocate scarce goods and one good which may not be scarce.</p><br> <p>--------------------------------------------------------------------</p><p><a href="event:function=viewLesson,479"><b><font color="#CC6666">Online Lesson:</font> Marketplace: Teen Nightclubs</b></a><br><a href='http://www.econedlink.org/' target='_blank'>EconEdLink.org</a></p><br><p class="smaller_text">Ask your average teenager where they can hang out on the weekends and most will tell you there aren't many options. The movies, the mall and someone's house just about sum it up. So an intrepid entrepreneur in Los Angeles is looking to cash in on ...</p><br><p>--------------------------------------------------------------------</p><p><a href="event:function=viewLesson,629"><b><font color="#CC6666">Online Lesson:</font> Why do we need money? Think about Ebay!</b></a><br><a href='http://www.econedlink.org/' target='_blank'>EconEdLink.org</a></p><br><p class="smaller_text">The students investigate money--its purpose and functions. They complete an exercise, using the online acution site Ebay, to learn why money is critical to an economy.</p><br><p>--------------------------------------------------------------------</p><p><a href="event:function=viewLesson,505"><b><font color="#CC6666">Online Lesson:</font> Marketplace: Corporate Leap Frog</b></a><br><a href='http://www.econedlink.org/' target='_blank'>EconEdLink.org</a></p><br><p class="smaller_text">This lesson will focus on competition among sellers and the factors that can make one company more successful than another in the same market. Competition between K-Mart, Wal- Mart, and Target will be examined to see what kinds of competition...</p><br><p class="tipHeading">Middle School Lessons</p><p>--------------------------------------------------------------------</p><p><a href="event:function=viewLesson,20773"><b>Lesson 11: Why Are There Foreign Currency Markets?</b></a><br><a href="event:function=viewPublication,9">The Wide World of Trade</a></p><br><p class="smaller_text">After listing some of their own buying and selling activities, students recognize that most people and families are both buyers and sellers who make exchanges in different kinds of markets. The relationship between output markets for goods and se...</p><br><p>--------------------------------------------------------------------</p><p><a href="event:function=viewLesson,15855"><b>Lesson 10 - Where Does the Price of Pizza Come From? Part 1</b></a><br><a href="event:function=viewPublication,3">Mathematics & Economics: Connections for Life - 6-8</a></p><br><p class="smaller_text">This lesson challenges students to identify the source of market prices. The students will complete a series of activities that represent supply and demand. In Activity 10.1, the students are asked to plot points, connect the points through a stra...</p><br><p>--------------------------------------------------------------------</p><p><a href="event:function=viewLesson,15848"><b>Lesson 3 - Baby-sitting Wages and Movie Prices</b></a><br><a href="event:function=viewPublication,3">Mathematics & Economics: Connections for Life - 6-8</a></p><br><p class="smaller_text">Through an analysis of data for baby-sitting wages (a price for labor) and the price of movie tickets since 1945, this lesson introduces the students to the idea that prices for goods, services, and resources change over time. The lesson provides ...</p><br><p>--------------------------------------------------------------------</p><p><a href="event:function=viewLesson,62205"><b>Chapter 3: Lesson 7 - The Mystery of the Alien Bananas</b></a><br><a href="event:function=viewPublication,45">The Great Economic Mysteries Book: A Guide to Teaching Economic Reasoning, Grades 4-8</a></p><br><p class="smaller_text">Students describe an economic mystery and discuss various explanations of it. They use economic principles and true/false clues in reasoning out a solution to the mystery.</p><br> <p>--------------------------------------------------------------------</p><p><a href="event:function=viewLesson,747"><b><font color="#CC6666">Online Lesson:</font> The Prices Are Changing</b></a><br><a href='http://www.econedlink.org/' target='_blank'>EconEdLink.org</a></p><br><p class="smaller_text">This lesson will help students to understand how markets are created by the interaction of buyers and sellers, what demand and supply are, what equilibrium price is, and how demand and supply interact with price changes.</p><br><p>--------------------------------------------------------------------</p><p><a href="event:function=viewLesson,664"><b><font color="#CC6666">Online Lesson:</font> The Price of Gasoline: What's Behind It?</b></a><br><a href='http://www.econedlink.org/' target='_blank'>EconEdLink.org</a></p><br><p class="smaller_text">In this lesson, students investigate the variables that contribute to the cost of gasoline. They learn that while OPEC nations do influence the price of oil and thus the price of gasoline, other factors also influence the price.</p><br><p>--------------------------------------------------------------------</p><p><a href="event:function=viewLesson,645"><b><font color="#CC6666">Online Lesson:</font> Be An Ad Detective</b></a><br><a href='http://www.econedlink.org/' target='_blank'>EconEdLink.org</a></p><br><p class="smaller_text">Every day, students are bombarded by advertising. They cannot escape it. But marketers realize that many people—especially young people—are becoming very good at tuning ads out. Businesses thus are becoming more creative in their commu...</p><br><p>--------------------------------------------------------------------</p><p><a href="event:function=viewLesson,369"><b><font color="#CC6666">Online Lesson:</font> Lemon Squeeze - The Lemonade Stand</b></a><br><a href='http://www.econedlink.org/' target='_blank'>EconEdLink.org</a></p><br><p class="smaller_text">Everyone has at one time or another opened a lemonade or Kool-Aid Stand. What a great place to begin an economics lesson. Students can taste test three brands of lemonade and compare prices with taste – is the most expensive the best? U...</p><br><p>--------------------------------------------------------------------</p><p><a href="event:function=viewLesson,313"><b><font color="#CC6666">Online Lesson:</font> From Butterflies to Buffaloes</b></a><br><a href='http://www.econedlink.org/' target='_blank'>EconEdLink.org</a></p><br><p class="smaller_text">Nature tourism, also known as ecotourism, is a fast growing segment of the tourism industry. In this lesson, students learn what ecotourism is and explore how conservation of our natural resources can be profitable.</p><br><p class="tipHeading">Elementary Lessons</p><p>--------------------------------------------------------------------</p><p><a href="event:function=viewLesson,68173"><b>Theme 3: Lesson 10 - Why Do I Want All This Stuff?</b></a><br><a href="event:function=viewPublication,134">Financial Fitness for Life: Grades 3-5 - Teacher Guide</a></p><br><p class="smaller_text">The students learn about types of advertising appeals, such as bandwagon, celebrity endorsement, and authority endorsement. They analyze ads to identify target audiences, the types of appeal used, and the facts and opinions included in the ads. Th...</p><br><p>--------------------------------------------------------------------</p><p><a href="event:function=viewLesson,62357"><b>Lesson 12: Market Madness</b></a><br><a href="event:function=viewPublication,59">Master Curriculum Guides in Economics: Teaching Strategies - 5-6</a></p><br><p class="smaller_text">The market (price) system answers the basic economic questions of what, how and for whom to produce in the marketplace. The demand decisions of consumers and the supply decisions of producers interact to establish prices and quantities exchanged....</p><br><p>--------------------------------------------------------------------</p><p><a href="event:function=viewLesson,62356"><b>Lesson 11: Market Balance</b></a><br><a href="event:function=viewPublication,59">Master Curriculum Guides in Economics: Teaching Strategies - 5-6</a></p><br><p class="smaller_text">The market (price) system answers the basic economic questions of what, how, and for whom to produce in the marketplace. The demand decisions of consumers and the supply decisions of producers interact to establish prices and quantities exchanged...</p><br><p>--------------------------------------------------------------------</p><p><a href="event:function=viewLesson,62348"><b>Lesson 3: Dandy Dollars Takes a Trip</b></a><br><a href="event:function=viewPublication,59">Master Curriculum Guides in Economics: Teaching Strategies - 5-6</a></p><br><p class="smaller_text">A market (price) system coordinates economic activity through markets. There are hundreds of thousands of different markets that are interrelated and usually dependent upon one another. The circular flow of economic activity is a model of the fl...</p><br><p>--------------------------------------------------------------------</p><p><a href="event:function=viewLesson,62323"><b>Lesson 11: Those Golden Jeans</b></a><br><a href="event:function=viewPublication,58">Master Curriculum Guides in Economics: Teaching Strategies - 3-4</a></p><br><p class="smaller_text">Supply and demand are concepts that students can easily understand when the concepts are demonstrated with products familiar to them. The Law of Demand states that consumers are willing and able to buy less of a product at higher prices and more ...</p><br><p>--------------------------------------------------------------------</p><p><a href="event:function=viewLesson,20989"><b>Unit 5: Lesson 23 - To Market, To Market</b></a><br><a href="event:function=viewPublication,16">Master Curriculum Guides in Economics: Teaching Strategies - K-2</a></p><br><p class="smaller_text">Students construct and play a shopping game as they learn that markets are places where things are bought and sold.</p><br> <p>--------------------------------------------------------------------</p><p><a href="event:function=viewLesson,383"><b><font color="#CC6666">Online Lesson:</font> Competition: Pizza!</b></a><br><a href='http://www.econedlink.org/' target='_blank'>EconEdLink.org</a></p><br><p class="smaller_text">Students will learn about competition in the market place. They will understand that competition takes place when there are many buyers and sellers of similar products. They will discuss how competition among sellers results in lower costs an...</p><br><p>--------------------------------------------------------------------</p><p><a href="event:function=viewLesson,176"><b><font color="#CC6666">Online Lesson:</font> Car Shopping</b></a><br><a href='http://www.econedlink.org/' target='_blank'>EconEdLink.org</a></p><br><p class="smaller_text">Contrary to US methods of distribution (namely prices), the Soviet Union used different methods of distribution of its goods during the reign of Communism. This lesson will explore the benefits and consequences of each of those methods of di...</p><br>]]></lessons>
<tips><![CDATA[<p class="tipHeading">Tip #1</p><p>If you ask the students what a market is, they are likely to name a local grocery store. Send them on a "Hunt for Markets" by having them make a list of all the goods and services they and their families buy and where/how they buy them (in stores, by phone, on the Internet). From this list, help the students generalize that markets aren't "places" but are situations in which products are available and buyers and sellers are able to interact.</p><br><p class="tipHeading">Tip #2</p><p>There is a vocabulary issue with the word "price." In everyday language, we use "price" and "cost" interchangeably. In economics, "price" refers to the amount consumers pay and producers receive for a good or service. "Cost" is related to the amount producers pay to produce goods and services. Keeping the vocabulary straight in the early grades will make it easier for the students to gain an understanding of revenue, costs of production and profit later.</p><br><p class="tipHeading">Tip #3</p><p>Younger students may think that price is determined by the size of the product with big things like houses and cars having high prices and little things like pencils having low prices. Older students may see the function of a good or the costs of inputs of production as determining the price. In economics, the price is determined by the interaction of the forces of supply and demand. The prices of goods, services and resources do not have definite values defined in advance. Have the students view price as the child of supply and demand. Just as a child is created by parents, price is created by the interaction of supply and demand. Different parents create different children just as different supply and demand situations create different prices.</p><br><p class="tipHeading">Tip #4</p><p>Prices are the key to allocating resources. Market prices bring self-interest and the general welfare together. Adam Smith called this the "invisible hand." Students have difficulty with the idea of the invisible hand because there is a natural tendency to associate order with central planning. However, in a decentralized market system, prices bring order to the choices of millions of consumers and producers and reflect information about cost, preferences and other variables. And prices do this while maximizing individual freedom.</p><br>]]></tips>
<resources><![CDATA[<p><b>Interactive tools:</b><br /></p><p><font color="#CC6666">Video</font> <a href='http://www.econedlink.org/i208' target='_blank'>Competition and Market Structures</a></p><p>This video teaches the concept of Competition and Market Structures. In the context of markets, competition refers to the situation when producers would each like to sell their goods or services to the same customers. The great benefit of competit...<br><font size="-10"><br /></font><font size="-3">Date Published: 07/12/2012<br>Grades: 6-8, 9-12<br />Source: <a href='http://www.econedlink.org/' target='_blank'>EconEdLink.org</a></font></p><br><p><font color="#CC6666">Video</font> <a href='http://www.econedlink.org/i216' target='_blank'>Markets and Prices</a></p><p>This video teaches the concept of Markets and Prices. A market refers to a group of buyers and sellers for a given good or service. The price is the amount of money needed to buy a particular good or service.<br><font size="-10"><br /></font><font size="-3">Date Published: 07/12/2012<br>Grades: 6-8, 9-12<br />Source: <a href='http://www.econedlink.org/' target='_blank'>EconEdLink.org</a></font></p><br><p><font color="#CC6666">Video</font> <a href='http://www.econedlink.org/i61' target='_blank'>Making Sen$e with Paul Solman: How Big is Too Big to Fail?</a></p><p>Paul Solman speaks to economist George Shultz about how massive bank mergers affect the idea of "too big to fail."""<br><font size="-10"><br /></font><font size="-3">Date Published: 12/15/2009<br>Grades: 9-12<br />Source: <a href='http://www.econedlink.org/' target='_blank'>EconEdLink.org</a></font></p><br><p><font color="#CC6666">Video</font> <a href='http://www.econedlink.org/i210' target='_blank'>Demand</a></p><p>This video teaches the concept of Demand. Demand refers to a relationship between price and the quantity of a good or service that consumers demand.<br><font size="-10"><br /></font><font size="-3">Date Published: 07/12/2012<br>Grades: 3-5, 6-8, 9-12<br />Source: <a href='http://www.econedlink.org/' target='_blank'>EconEdLink.org</a></font></p><br><p><font color="#CC6666">Video</font> <a href='http://www.econedlink.org/i217' target='_blank'>Price Ceilings and Floors</a></p><p>This video teaches the concept of Price Ceilings and Floors. A price ceiling is a legally established maximum price while a price floor is a legally established minimum price.<br><font size="-10"><br /></font><font size="-3">Date Published: 07/12/2012<br>Grades: 9-12<br />Source: <a href='http://www.econedlink.org/' target='_blank'>EconEdLink.org</a></font></p><br><p>-------------------------------------</p><p><b>Lessons:</b></p><br><p><a href='http://www.econedlink.org/e692' target='_blank'>Henry Ford and the Model T: A Case Study in Productivity (Part 3)</a></p><p>When Henry Ford announced he was going to produce an automobile that would be affordable to the masses, it is doubtful even he realized the far reaching impact such an achievement would have on life in the U.S. and eventually, the world. Ford’s use of mass production strategies to manufacture the Model T revolutionized industrial manufacturing and initiated a new era in personal transportation. This 3-part learning unit provides students with the story of Henry Ford and the Model T from an economics perspective. Parts 1 and 2 explore how the Ford Motor Company successfully introduced mass production strategies to the auto industry. Students learn how specialization and investments in capital (machines, people, etc.) increased productivity and allowed Ford to slash the price of his popular vehicle. Students chart a plan for the assembly line production of bookmarks, test their plan and make recommendations for improvements. Students also explore how Henry Ford used economic incentives to address a problem created by mass production techniques—worker turnover. An optional Part 3 explains how increased productivity resulted in shifts in the supply and demand for the Model T. Students analyze how a variety of non price determinants continue to influence the automobile market today. A wealth of extension activities is provided if additional time is available.<br><font size="-10"><br /></font><font size="-3">Date Published: 01/15/2008<br />Grades: 6-8, 9-12<br />Source: <a href='http://www.econedlink.org/' target='_blank'>EconEdLink.org</a></font></p><br><p><a href='http://www.econedlink.org/e369' target='_blank'>Lemon Squeeze - The Lemonade Stand</a></p><p>Everyone has at one time or another opened a lemonade or Kool-Aid Stand. What a great place to begin an economics lesson. Students can taste test three brands of lemonade and compare prices with taste – is the most expensive the best? Using a reader’s theater students will construct a supply and demand schedule and can create a bar or line graph to demonstrate market interaction between buyers and sellers.<br><font size="-10"><br /></font><font size="-3">Date Published: 08/26/2002<br />Grades: 3-5, 6-8<br />Source: <a href='http://www.econedlink.org/' target='_blank'>EconEdLink.org</a></font></p><br><p><a href='http://www.econedlink.org/e317' target='_blank'>Economics in the Headlines</a></p><p>Students learn how to identify headlines in the news and current events as illustrations of problems in supply and demand. Students will be linked to news sites to create their own analysis of supply and demand issues in problems facing our society.<br><font size="-10"><br /></font><font size="-3">Date Published: 05/02/2002<br />Grades: 9-12<br />Source: <a href='http://www.econedlink.org/' target='_blank'>EconEdLink.org</a></font></p><br><p><a href='http://www.econedlink.org/e747' target='_blank'>The Prices Are Changing</a></p><p>This lesson will help students to understand how markets are created by the interaction of buyers and sellers, what demand and supply are, what equilibrium price is, and how demand and supply interact with price changes.<br><font size="-10"><br /></font><font size="-3">Date Published: 06/11/2009<br />Grades: 6-8<br />Source: <a href='http://www.econedlink.org/' target='_blank'>EconEdLink.org</a></font></p><br><p><a href='http://www.econedlink.org/e725' target='_blank'>Transportation: They Say We Had a Revolution (Part 2)</a></p><p>Advancements in transportation have played a key role in the growth of our nation. U.S.government policies have also had a considerable impact on the development of transport as we know it today. In this series of three lessons, the students examine the advancements in automobiles, roads, airlines and airports.<br><font size="-10"><br /></font><font size="-3">Date Published: 06/03/2009<br />Grades: 6-8, 9-12<br />Source: <a href='http://www.econedlink.org/' target='_blank'>EconEdLink.org</a></font></p><br>]]></resources>
<related>
<concept>23</concept>
<concept>34</concept>
<concept>22</concept>
<concept>25</concept>
</related>
<quiz>1</quiz>
</concept>
<concept>
<id>15</id>
<name>Monetary Policy and the Federal Reserve</name>
<category>1</category>
<definition><![CDATA[<p><b>Monetary policy</b> involves regulating the <a href="event:function=defineGlossaryTerm,Money Supply">money supply</a>, banks and the overall financial system. <a href="event:function=defineGlossaryTerm,Monetary Policy">Monetary policy </a>is conducted by a central bank, which in the United States is called the <b><a href="event:function=defineGlossaryTerm,Federal Reserve">Federal Reserve</a></b>. When the economy is in a <a href="event:function=defineGlossaryTerm,Recession">recession</a>, central bank officials will use expansionary monetary policy, which seeks to reduce interest rates by expanding the supply of money in the economy. In turn, the lower interest rates will encourage additional <a href="event:function=defineGlossaryTerm,Aggregate Demand (AD)">aggregate demand</a> for <a href="event:function=defineGlossaryTerm,Consumption">consumption</a> and <a href="event:function=defineGlossaryTerm,Investment">investment</a>, and thus help shorten or end the recession. When an economy is experiencing <a href="event:function=defineGlossaryTerm,Inflation">inflation</a>, central bank officials will use contractionary monetary policy, which seeks to raise interest rates by contracting (or reducing the rate of growth in) the money supply. </p> <br><p>A central bank has three tools to influence the money supply and interest rates, all of which operate through the <a href="event:function=defineGlossaryTerm,Banking">banking</a> system. The first and most commonly used tool is <a href="event:function=defineGlossaryTerm,Open Market Operations">open market operations</a>, which involves buying and selling government <a href="event:function=defineGlossaryTerm,Bond">bonds</a>. When the central bank buys bonds, it increases the amount of money in the economy; when the central bank sells bonds, it reduces the amount of money in the economy. In conducting open market operations, the Federal Reserve tries to influence the federal funds rate, which is the interest rate a bank charges when it lends <a href="event:function=defineGlossaryTerm,Excess Reserves"> excess reserves</a> to another bank. A second tool is the reserve requirement, which is the percentage of <a href="event:function=defineGlossaryTerm,Deposit">deposits</a> that banks are required to hold and not lend out. A higher reserve requirement reduces the money supply by limiting bank lending; a lower reserve requirement increases the money supply by increasing bank lending. The third tool is the <a href="event:function=defineGlossaryTerm,Discount Rate">discount rate</a>, which is the rate charged by the central bank if individual banks wish to <a href="event:function=defineGlossaryTerm,Borrow">borrow</a> funds. A higher discount rate reduces the money supply while a lower discount rate increases the money supply. In times of financial crisis, the Federal Reserve may exercise emergency powers to stabilize financial markets or to oversee the winding-down of troubled financial institutions.</p>]]></definition>
<lessons><![CDATA[<p>Below are <b>featured</b> lessons for teaching Monetary Policy and the Federal Reserve.</p><br><p class="tipHeading">High School Lessons</p><p>--------------------------------------------------------------------</p><p><a href="event:function=viewLesson,68111"><b>Lesson 8 - Understanding Financial Markets, 2007-2009</b></a><br><a href="event:function=viewPublication,140">Teaching Financial Crises</a></p><br><p class="smaller_text">This lesson pulls together the events in financial markets from 2007 to 2009 by examining the persons and financial institutions that played key roles in the crisis, including why it occurred, who was affected, and the aftermath. How better to und...</p><br><p>--------------------------------------------------------------------</p><p><a href="event:function=viewLesson,68108"><b>Lesson 5 - Monetary Policy in the Recent Financial Crisis</b></a><br><a href="event:function=viewPublication,140">Teaching Financial Crises</a></p><br><p class="smaller_text">Actions are taken by the Board of Governors of the Federal Reserve System (the Fed) to create a stable macroeconomy. Part 1 of the lesson places the student in the role of an economic analyst diagnosing the economy by viewing 2007-2009 data regard...</p><br><p>--------------------------------------------------------------------</p><p><a href="event:function=viewLesson,67754"><b>Lesson 28: Money Panics and the Establishment of the Federal Reserve System</b></a><br><a href="event:function=viewPublication,105">Focus: Understanding Economics in U.S. History</a></p><br><p class="smaller_text">Several students perform a play that illustrates how an unregulated banking system contributed to a number of severe money panics in the late nineteenth century. The students then read a passage about the establishment of the Federal Reserve Syste...</p><br><p>--------------------------------------------------------------------</p><p><a href="event:function=viewLesson,60260"><b>Lesson 10: Macroeconomic Stabilization Policies and Institutions</b></a><br><a href="event:function=viewPublication,39">Focus: Institutions and Markets</a></p><br><p class="smaller_text">This lesson begins by reviewing the discovery and adoption of Keynesian fiscal policies in the United States and other nations following World War II. Students then participate in several exercises to ascertain their understanding of appropriate ...</p><br><p>--------------------------------------------------------------------</p><p><a href="event:function=viewLesson,974"><b><font color="#CC6666">Online Lesson:</font> Focus on Economic Data: The Federal Reserve and Monetary Policy, November 3, 2010</b></a><br><a href='http://www.econedlink.org/' target='_blank'>EconEdLink.org</a></p><br><p class="smaller_text">This lesson focuses on the November 3, 2010, press release by the Federal Reserve System's Federal Open Market Committee (FOMC) on the current Federal Reserve monetary policy actions and goals. Specifically, the lesson reports the target rate for ...</p><br><p>--------------------------------------------------------------------</p><p><a href="event:function=viewLesson,700"><b><font color="#CC6666">Online Lesson:</font> Who Is Ben Bernanke?</b></a><br><a href='http://www.econedlink.org/' target='_blank'>EconEdLink.org</a></p><br><p class="smaller_text">This lesson introduces students to the Chairman of the Federal Reserve System, Ben Bernanke. It describes briefly his involvement within the Federal Reserve.</p><br><p>--------------------------------------------------------------------</p><p><a href="event:function=viewLesson,698"><b><font color="#CC6666">Online Lesson:</font> It's a Not So Wonderful Life</b></a><br><a href='http://www.econedlink.org/' target='_blank'>EconEdLink.org</a></p><br><p class="smaller_text">In this lesson students learn about banks and banking. The study the fractional reserve system, and the role the Fed plays in the money creation process.</p><br><p>--------------------------------------------------------------------</p><p><a href="event:function=viewLesson,395"><b><font color="#CC6666">Online Lesson:</font> One is Silver and the Other's Gold</b></a><br><a href='http://www.econedlink.org/' target='_blank'>EconEdLink.org</a></p><br><p class="smaller_text">Students learn about the money supply and that it can affect the value of money. Students investigate this in the 1896 presidential election (Bryan vs. McKinley, Free Silver vs. Gold Standard) and examine a political cartoon that depicts how ...</p><br><p>--------------------------------------------------------------------</p><p><a href="event:function=viewLesson,352"><b><font color="#CC6666">Online Lesson:</font> Fiscal and Monetary Policy Process</b></a><br><a href='http://www.econedlink.org/' target='_blank'>EconEdLink.org</a></p><br><p class="smaller_text">Students follow each step of fiscal and monetary policy processes, to see the logic of how these tools are used to correct economic instability.</p><br><p class="tipHeading">Elementary Lessons</p><p>--------------------------------------------------------------------</p><p><a href="event:function=viewLesson,61984"><b>Lesson 3: What Happens When a Bank Makes a Loan?</b></a><br><a href="event:function=viewPublication,101">Learning, Earning and Investing: Grades 4-5 Lessons</a></p><br><p class="smaller_text">The students play roles in a simulation activity designed to show how bank loans made to individuals can have an impact on others in the community. Then, working in small groups, the students analyze other hypothetical loans, using flow charts or ...</p><br> <p>--------------------------------------------------------------------</p><p><a href="event:function=viewLesson,169"><b><font color="#CC6666">Online Lesson:</font> On The Money</b></a><br><a href='http://www.econedlink.org/' target='_blank'>EconEdLink.org</a></p><br><p class="smaller_text">In this lesson, students explore what money is and how it differs around the world. They will compare U.S. currency with play money and with foreign currency. They will then use their knowledge to design their own money.</p><br><p>--------------------------------------------------------------------</p><p><a href="event:function=viewLesson,63"><b><font color="#CC6666">Online Lesson:</font> Changes in Change</b></a><br><a href='http://www.econedlink.org/' target='_blank'>EconEdLink.org</a></p><br><p class="smaller_text">This lesson begins with students visiting a web site that gives them practice in counting money. The second site goes one step further in that students are given opportunities to make change for make-believe purchases.</p><br>]]></lessons>
<tips><![CDATA[<p class="tipHeading">Tip #1</p><p>Karl Ochi, economics teacher at Washington High School in San Francisco, uses this "rope of monetary policy" analogy to explain how monetary policy works: A sturdy rope is tied around the waist of a student volunteer. The teacher holds the other end of the rope. A wall in front of the student is marked with the sign "Y/Full-Employment Output/Capacity." The student is instructed to move, with steady pressure, toward the sign on the wall. At first, the teacher should hold the rope tightly, preventing the student from reaching the target. Then the teacher should let the rope loose and the student will fall forward, bumping into the target; the excess rope falls to the floor. In this example, the rope represents the money supply, the student represents GDP or output, the sign represents capacity (cannot be exceeded by much in the short run) and the teacher represents the Federal Reserve. This is a direct visual depiction of tight and loose monetary policy. Then the teacher should secretly tell the student to move forward and backward erratically to show that monetary policy must be dynamic to adjust to changing economic conditions. The students are challenged to determine the conditions under which tight and loose monetary policy would be appropriate as well as the pitfalls of incorrectly timed policy or of too drastic a policy action.</p><br><p class="tipHeading">Tip #2</p><p>Money creation seems mysterious to many students. Illustrate it this way:<li>The teacher, who represents the Fed, buys a $1,000 bond from a student. The student has $1,000 and deposits the money in a bank.</li><li>The bank holds 20 percent in reserves and lends the remaining $800 to another student. The student spends the $800, which is deposited in another bank.</li><li>The second bank lends out 80 percent or $640.</li>You can then track how much money is created by the Fed's buying a bond on the open market. During each round the money supply increases, but by a lesser amount. Finally, explore policies which will increase or decrease the money supply such as changing the reserve requirement or encouraging or discouraging banks to lend money.</p><br><p class="tipHeading">Tip #3</p><p>The Federal Reserve has taken drastic steps to avoid a financial meltdown in the U.S. economy in recent years. In addition to their customary tools of monetary policy such as open market operations (used recently to lower the Federal Funds Rate to almost 0%) and discount lending (used to aid banks in need of liquidity); the Fed has expanded its playbook to deal with the financial crisis of 2007-2008. The Fed has purchased significant quantities of U.S. government debt in an effort to lower the interest rate on these bonds (a technique is referred to as ?quantitative easing?) and even purchased the debt of private firms (known as commercial paper). A number of online sources can be accessed to show how the Fed?s balance sheet has expanded significantly over the course of the crisis.</p><br>]]></tips>
<resources><![CDATA[<p><b>Interactive tools:</b><br /></p><p><font color="#CC6666">Video</font> <a href='http://www.econedlink.org/i41' target='_blank'>Making Sen$e with Paul Solman: Efforts to Revive Economy Test Inflation Theories</a></p><p>The threat of inflation is testing the Federal Reserve as it works to determine how to unwind emergency moves taken during the financial crisis.<br><font size="-10"><br /></font><font size="-3">Date Published: 08/21/2009<br>Grades: 9-12<br />Source: <a href='http://www.econedlink.org/' target='_blank'>EconEdLink.org</a></font></p><br><p><font color="#CC6666">Flash</font> <a href='http://www.econedlink.org/i114' target='_blank'>Gen i Revolution - Mission 13: Stock Market Crashes</a></p><p>This interactive tool is a part of the online personal finance game, Gen i Revolution. This is one of the fifteen "Missions" available within the online game. This Mission takes about 30 minutes to complete. To sign up to play the game, you'll nee...<br><font size="-10"><br /></font><font size="-3">Date Published: 08/14/2010<br>Grades: 6-8, 9-12<br />Source: <a href='http://www.econedlink.org/' target='_blank'>EconEdLink.org</a></font></p><br><p><font color="#CC6666">Video</font> <a href='http://www.econedlink.org/i16' target='_blank'>Making Sen$e with Paul Solman: Where the Bailout Money Comes From</a></p><p>Paul Solman explains how the government will produce the money to fund its economic-rescue measures while trying to keep inflation down.<br><font size="-10"><br /></font><font size="-3">Date Published: 03/17/2009<br>Grades: 9-12<br />Source: <a href='http://www.econedlink.org/' target='_blank'>EconEdLink.org</a></font></p><br><p><font color="#CC6666">Video</font> <a href='http://www.econedlink.org/i206' target='_blank'>Monetary Policy and the Federal Reserve</a></p><p>This video teaches the concepts of Monetary Policy and the Federal Reserve. Monetary policy involves regulating the money supply, banks and the overall financial system. Monetary policy is conducted by a central bank, which in the United States is...<br><font size="-10"><br /></font><font size="-3">Date Published: 07/12/2012<br>Grades: 3-5, 6-8, 9-12<br />Source: <a href='http://www.econedlink.org/' target='_blank'>EconEdLink.org</a></font></p><br><p><font color="#CC6666">Video</font> <a href='http://www.econedlink.org/i39' target='_blank'>Making Sen$e with Paul Solman: Problem of Transparency Nothing New to the Fed</a></p><p>As questions arise about the Federal Reserve's transparency, Paul Solman looks at the agency's attempts to balance public disclosure and secrecy.<br><font size="-10"><br /></font><font size="-3">Date Published: 07/30/2009<br>Grades: 9-12<br />Source: <a href='http://www.econedlink.org/' target='_blank'>EconEdLink.org</a></font></p><br><p>-------------------------------------</p><p><b>Lessons:</b></p><br><p><a href='http://www.econedlink.org/e29' target='_blank'>Fed Orders Interest Rate Cut</a></p><p>On October 15, 1998 Alan Greenspan and the Board of Governors, in a surprise move ordered short-term interest rates cut by 0.25%. What prompted the Fed to take this action? What impact will the rate change have on the economy? Analyze the articles below to examine the linkages between actions of the Federal Reserve Bank and economic performance.<br><font size="-10"><br /></font><font size="-3">Date Published: 10/12/1998<br />Grades: 9-12<br />Source: <a href='http://www.econedlink.org/' target='_blank'>EconEdLink.org</a></font></p><br><p><a href='http://www.econedlink.org/e34' target='_blank'>Y2K, Currency, Banking, and the Fed</a></p><p>Almost everybody has heard about the Y2K problem. It has raised fears about everything from the security of our water supply to the threat of missile attacks triggered by computer glitches. Some of these threats seem pretty far-fetched. But what about threats to the security of our money? Could the Y2K problem wreak havoc with our bank accounts and other financial holdings? What can be done to prevent trouble of this sort from occuring? And whose job is it to ensure that the necessary steps are taken? This lesson addresses these questions.<br><font size="-10"><br /></font><font size="-3">Date Published: 05/10/1999<br />Grades: 9-12<br />Source: <a href='http://www.econedlink.org/' target='_blank'>EconEdLink.org</a></font></p><br><p><a href='http://www.econedlink.org/e700' target='_blank'>Who Is Ben Bernanke?</a></p><p>This lesson introduces students to the Chairman of the Federal Reserve System, Ben Bernanke. It describes briefly his involvement within the Federal Reserve.<br><font size="-10"><br /></font><font size="-3">Date Published: 06/08/2009<br />Grades: 9-12<br />Source: <a href='http://www.econedlink.org/' target='_blank'>EconEdLink.org</a></font></p><br><p><a href='http://www.econedlink.org/e45' target='_blank'>Trish and Scott's Big Adventure: An Investigation of Regional Housing Costs</a></p><p>This lesson has students explore differences in regional housing costs, determine the percentage of gross income spent on housing, assess the impact of housing costs on a relocation decision and recognize wages and housing costs are prices.<br><font size="-10"><br /></font><font size="-3">Date Published: 11/03/1999<br />Grades: 6-8, 9-12<br />Source: <a href='http://www.econedlink.org/' target='_blank'>EconEdLink.org</a></font></p><br><p><a href='http://www.econedlink.org/e36' target='_blank'>The Early 1980s: A Tough Time For Home Builders and Mortgage Bankers</a></p><p>Have you ever thought of how much it might cost you to finance the purchase of a home? The home's purchase price is likely to be many times the yearly income of the typical household. If families waited until they had accumulated enough savings to use cash to pay for a home, they would be denied the benefits of homeownership for many years. Instead, most families go to a mortgage banker or some other lending institution to obtain the necessary credit to purchase their home. A mortgage loan is a credit instrument used by homebuyers to finance the purchase of a home. Interest payments made on the mortgage loan represent the cost of acquiring this credit. For most homebuyers, the largest cost of buying a home is the monthly interest paid on the mortgage loan.<br><font size="-10"><br /></font><font size="-3">Date Published: 06/10/1999<br />Grades: 9-12<br />Source: <a href='http://www.econedlink.org/' target='_blank'>EconEdLink.org</a></font></p><br>]]></resources>
<related>
<concept>12</concept>
<concept>13</concept>
<concept>14</concept>
<concept>9</concept>
</related>
<quiz>1</quiz>
</concept>
<concept>
<id>9</id>
<name>Money</name>
<category>0</category>
<definition><![CDATA[<p><b>Money</b> is anything that is used to buy and sell <a href="event:function=defineGlossaryTerm,Goods">goods</a> and <a href="event:function=defineGlossaryTerm,Services">services</a>. <a href="event:function=defineGlossaryTerm,Money">Money</a> has three functions. First, it is a medium of <a href="event:function=defineGlossaryTerm,Exchange">exchange</a>, which means that it is generally accepted as payment for goods and services. Second, it is a store of value; that is, it retains its value at least over periods of days and months. Third, it is a unit of account, so that values are measured in units of money. In different times and places, many different items have served these three functions of money: gold, silver, shells, cattle, tobacco and printed paper <a href="event:function=defineGlossaryTerm,Currency">currency</a>. Today individuals, <a href="event:function=defineGlossaryTerm,Business">businesses</a> and governments often use <a href="event:function=defineGlossaryTerm,Deposit">deposits</a> in <a href="event:function=defineGlossaryTerm,Checking Account">checking</a> and similar accounts as money. Money from these accounts can be moved electronically, as with a debit card, or a paper check may be written.</p> ]]></definition>
<lessons><![CDATA[<p>Below are <b>featured</b> lessons for teaching Money.</p><br><p class="tipHeading">High School Lessons</p><p>--------------------------------------------------------------------</p><p><a href="event:function=viewLesson,67753"><b>Lesson 27: Free Silver or a Cross of Gold?</b></a><br><a href="event:function=viewPublication,105">Focus: Understanding Economics in U.S. History</a></p><br><p class="smaller_text">The students view a series of visuals to learn about the money controversy of the last decades of the nineteenth century. They conduct a simulation activity designed to show why proponents of the Greenback and Free Silver movements believed that a...</p><br><p>--------------------------------------------------------------------</p><p><a href="event:function=viewLesson,68077"><b>Money: Reducing the Costs of Trade</b></a><br><a href="event:function=viewPublication,117">What Economics Is About: Understanding the Basics of Our Economic System</a></p><br><p class="smaller_text">Money is an indispensable part of all modern economic systems. Money can be broadly defined as a medium of exchange. Since money is convenient to use and readily acceptable, individuals use it as payment when exchanging goods and services. Using m...</p><br><p>--------------------------------------------------------------------</p><p><a href="event:function=viewLesson,17828"><b>Unit 6: Lesson 34 - Money and Monetary Policy</b></a><br><a href="event:function=viewPublication,1">Capstone: Exemplary Lessons for High School Economics - Teacher's Guide</a></p><br><p class="smaller_text">The concept of money creation by banks is often not intuitive for students, but it is important to their understanding of the role of the Federal Reserve. In this lesson, students first discuss money, its functions, and why the money supply is im...</p><br><p>--------------------------------------------------------------------</p><p><a href="event:function=viewLesson,15432"><b>Lesson 11 - Money and Inflation</b></a><br><a href="event:function=viewPublication,2">Economics in Action: 14 Greatest Hits for Teaching High School Economics</a></p><br><p class="smaller_text">Students observe a simple demonstration to determine the functions that money performs. They next participate in two rounds of an auction illustrating how increases in the money supply lead to inflation. They view an active demonstration of the eq...</p><br> <p>--------------------------------------------------------------------</p><p><a href="event:function=viewLesson,698"><b><font color="#CC6666">Online Lesson:</font> It's a Not So Wonderful Life</b></a><br><a href='http://www.econedlink.org/' target='_blank'>EconEdLink.org</a></p><br><p class="smaller_text">In this lesson students learn about banks and banking. The study the fractional reserve system, and the role the Fed plays in the money creation process.</p><br><p>--------------------------------------------------------------------</p><p><a href="event:function=viewLesson,395"><b><font color="#CC6666">Online Lesson:</font> One is Silver and the Other's Gold</b></a><br><a href='http://www.econedlink.org/' target='_blank'>EconEdLink.org</a></p><br><p class="smaller_text">Students learn about the money supply and that it can affect the value of money. Students investigate this in the 1896 presidential election (Bryan vs. McKinley, Free Silver vs. Gold Standard) and examine a political cartoon that depicts how ...</p><br><p>--------------------------------------------------------------------</p><p><a href="event:function=viewLesson,156"><b><font color="#CC6666">Online Lesson:</font> The Big Mac Index</b></a><br><a href='http://www.econedlink.org/' target='_blank'>EconEdLink.org</a></p><br><p class="smaller_text">How fast can you say "twoallbeefpattiesspecialsaucelettucecheesep icklesonionsonasesameseedbun?" This question was asked of millions of TV viewers in the now famous 1970s McDonald's television commercial promoting the Big Mac.</p><br><p>--------------------------------------------------------------------</p><p><a href="event:function=viewLesson,133"><b><font color="#CC6666">Online Lesson:</font> Money is What Money Does</b></a><br><a href='http://www.econedlink.org/' target='_blank'>EconEdLink.org</a></p><br><p class="smaller_text">Throughout history, a wide variety of items have served as money. These include gold, silver, large stone wheels, tobacco, beer, dog teeth, porpoise teeth, cattle, metal coins, paper bills, and checks. All of these types of money should be judged...</p><br><p class="tipHeading">Middle School Lessons</p><p>--------------------------------------------------------------------</p><p><a href="event:function=viewLesson,67879"><b>Lesson 10 - What Makes Money Acceptable</b></a><br><a href="event:function=viewPublication,115">Focus: Economics - Grades 3-5</a></p><br><p class="smaller_text">In this lesson, the students participate in a demonstration to identify the characteristics that make something a good form of money. Following the demonstration, the students learn about changes that were made to U.S. currency to protect the int...</p><br><p>--------------------------------------------------------------------</p><p><a href="event:function=viewLesson,15847"><b>Lesson 2 - Vacation Vexation</b></a><br><a href="event:function=viewPublication,3">Mathematics & Economics: Connections for Life - 6-8</a></p><br><p class="smaller_text">In this lesson, the students listen to the story of an American girl who is planning a trip to Mexico. They learn about foreign exchange and compare exchange rates to determine if one currency has appreciated or depreciated against another currenc...</p><br><p>--------------------------------------------------------------------</p><p><a href="event:function=viewLesson,15846"><b>Lesson 1 - Happy Deal?</b></a><br><a href="event:function=viewPublication,3">Mathematics & Economics: Connections for Life - 6-8</a></p><br><p class="smaller_text">In this lesson, the students learn about currencies used in selected countries. They compare the prices of a Big Mac© in different countries and convert the prices into U.S. dollars, using exchange rates. The students determine in which count...</p><br> <p>--------------------------------------------------------------------</p><p><a href="event:function=viewLesson,750"><b><font color="#CC6666">Online Lesson:</font> What Is Money? Why Does It Have Value?</b></a><br><a href='http://www.econedlink.org/' target='_blank'>EconEdLink.org</a></p><br><p class="smaller_text">In this lesson, students consider the fact that the value of money differs depending on where the money is being spent. In order to understand this idea, students will first develop a deeper understanding of what it means for money to have a valu...</p><br><p>--------------------------------------------------------------------</p><p><a href="event:function=viewLesson,556"><b><font color="#CC6666">Online Lesson:</font> Do I Look Like I'm Made of Money?</b></a><br><a href='http://www.econedlink.org/' target='_blank'>EconEdLink.org</a></p><br><p class="smaller_text">One of the most common replies given by parents when their children ask for money is “Do I look like I’m made of Money?” This lesson is designed to educate students about the need for money as a generally accepted medium of exch...</p><br><p>--------------------------------------------------------------------</p><p><a href="event:function=viewLesson,563"><b><font color="#CC6666">Online Lesson:</font> Agent Pincher: P is for Penny or Where did money come from?</b></a><br><a href='http://www.econedlink.org/' target='_blank'>EconEdLink.org</a></p><br><p class="smaller_text">Over time everyone has had a pocketful of pennies, it’s not something we think about very much. But what if we woke up tomorrow and found that there were no more pennies? Or what if we found that money had disappeared altogether -- not o...</p><br><p class="tipHeading">Elementary Lessons</p><p>--------------------------------------------------------------------</p><p><a href="event:function=viewLesson,68205"><b>Theme 3: Lesson 9 - We Decide to Spend</b></a><br><a href="event:function=viewPublication,131">Financial Fitness for Life: K-2 - Teacher Guide</a></p><br><p class="smaller_text">The students create want webs (configurations of illustrations and notations) for a hamster and then for themselves. They simulate the experience of spending money in exchange for goods and services when they use dimes to become consumers at a sch...</p><br><p>--------------------------------------------------------------------</p><p><a href="event:function=viewLesson,68199"><b>Theme 1: Lesson 3 - What Is Money?</b></a><br><a href="event:function=viewPublication,131">Financial Fitness for Life: K-2 - Teacher Guide</a></p><br><p class="smaller_text">This lesson focuses on two types of money: paper money and coins. The students identify money and its value (its buying power) while participating in a money-matching activity. They estimate the number of coins in a can; then they determine the ex...</p><br><p>--------------------------------------------------------------------</p><p><a href="event:function=viewLesson,68171"><b>Theme 3: Lesson 8 - How Would You Like to Pay?</b></a><br><a href="event:function=viewPublication,134">Financial Fitness for Life: Grades 3-5 - Teacher Guide</a></p><br><p class="smaller_text">The students are introduced to various methods of payment, such as cash, check, debit and credit cards, and electronic or online payments. They learn about the advantages and disadvantages of each method of payment. They also practice writing a ch...</p><br><p>--------------------------------------------------------------------</p><p><a href="event:function=viewLesson,67124"><b>Lesson 12: Birdly Exchange</b></a><br><a href="event:function=viewPublication,102">Mathematics & Economics: Connections for Life - 3-5</a></p><br><p class="smaller_text">This lesson focuses on barter, money and characteristics of money (economics) and fractions and ratios (mathematics). The students will role-play a bartering activity and participate in trading simulations using feathers and birdles (a form of pap...</p><br><p>--------------------------------------------------------------------</p><p><a href="event:function=viewLesson,61968"><b>Lesson 1 - A Rooster and a Bean Seed</b></a><br><a href="event:function=viewPublication,37">Roosters to Robots: Lesson Plans from Writers around the World</a></p><br><p class="smaller_text">In this lesson, students hear a folk tale and participate in a simulation that helps them recognize problems with barter and benefits of monetary exchange.</p><br><p>--------------------------------------------------------------------</p><p><a href="event:function=viewLesson,62320"><b>Lesson 8: Money Is What Money Does</b></a><br><a href="event:function=viewPublication,58">Master Curriculum Guides in Economics: Teaching Strategies - 3-4</a></p><br><p class="smaller_text">The basic purpose of money is to facilitate the exchange of goods and services. For money to have value, it must be acceptable by a large number of people. Money serves as a medium of exchange; that is, people exchange money for goods and servic...</p><br> <p>--------------------------------------------------------------------</p><p><a href="event:function=viewLesson,484"><b><font color="#CC6666">Online Lesson:</font> What Face do you Use?</b></a><br><a href='http://www.econedlink.org/' target='_blank'>EconEdLink.org</a></p><br><p class="smaller_text">The students will recognize that in order to facilitate the exchange of goods and services, most nations create currency for use as money. They will examine the characteristics of money by comparing and contrasting examples of U.S. and world curre...</p><br><p>--------------------------------------------------------------------</p><p><a href="event:function=viewLesson,460"><b><font color="#CC6666">Online Lesson:</font> No Funny Money, Honey....I Want the Real Thing!</b></a><br><a href='http://www.econedlink.org/' target='_blank'>EconEdLink.org</a></p><br><p class="smaller_text">Do you know what funny money is? It's NOT the real thing! Find out how our government tries to make our money hard to copy in this lesson about real and fake money.</p><br><p>--------------------------------------------------------------------</p><p><a href="event:function=viewLesson,179"><b><font color="#CC6666">Online Lesson:</font> The Changing Face of Money</b></a><br><a href='http://www.econedlink.org/' target='_blank'>EconEdLink.org</a></p><br><p class="smaller_text">In this lesson, students play a game to guess which objects have been used as money throughout history. In the process, they learn several basic economic concepts. For instance, money must be a unit of account, meaning that it must be able to bre...</p><br><p>--------------------------------------------------------------------</p><p><a href="event:function=viewLesson,169"><b><font color="#CC6666">Online Lesson:</font> On The Money</b></a><br><a href='http://www.econedlink.org/' target='_blank'>EconEdLink.org</a></p><br><p class="smaller_text">In this lesson, students explore what money is and how it differs around the world. They will compare U.S. currency with play money and with foreign currency. They will then use their knowledge to design their own money.</p><br><p>--------------------------------------------------------------------</p><p><a href="event:function=viewLesson,61"><b><font color="#CC6666">Online Lesson:</font> Pennies Make Cents</b></a><br><a href='http://www.econedlink.org/' target='_blank'>EconEdLink.org</a></p><br><p class="smaller_text">Students will review the history of trade before money and will investigate the history of money. Students will locate information about the first coin authorized by the United States and will learn about the penny.</p><br>]]></lessons>
<tips><![CDATA[<p class="tipHeading">Tip #1</p><p>Very young children are often confused by money. They often think that large coins (nickels) are worth more than small coins (dimes). They may think that the value of the currency is associated with the physical characteristics of the currency (color, size, photographs and serial numbers). Give the students opportunities to learn about the value of various coins and paper currency. </p><br><p class="tipHeading">Tip #2</p><p>Young students are fascinated with money. Ask them why they want money. Set up a scenario in the classroom where you pay the students for work they do with buttons or other items and where the students are able to buy small items with the buttons. After a few weeks, tell the students that you have enough buttons and that you won't accept buttons in payment for the small items. Discuss: 1) whether the students would still want to earn buttons and why and 2) how the students might obtain these items if you won't accept buttons.</p><br><p class="tipHeading">Tip #3</p><p>Mathematics programs often include worksheets that allow the students to practice adding and subtracting currency and making change.</p><br><p class="tipHeading">Tip #4</p><p>Money is what money does. Types of money should be judged on how well they accomplish the functions of money, which are 1) a medium of exchange, 2) a store of value and 3) a standard of value. Have the students discuss how well the following current and historical types of money perform these functions: salt, large stone wheels, gold, copper coins, pieces of paper printed by the government, personal checks, debit cards.</p><br><p class="tipHeading">Tip #5</p><p>The students are familiar with the money they carry around so many conclude that most money is currency. However, much money is held in checking accounts, available to be transferred by debit cards, electronic transactions or paper checks. It might seem strange to the students that checking accounts are considered to be part of the money supply. Ask the students how many bills are paid using cash (not many!). Students should know that most bills are paid by families and businesses using debit cards, electronic transfers, or checks. Because all of these methods transfer the ownership of bank deposits, the underlying checking accounts are generally accepted as a medium of exchange. </p><br>]]></tips>
<resources><![CDATA[<p><b>Interactive tools:</b><br /></p><p><font color="#CC6666">Flash</font> <a href='http://www.econedlink.org/i248' target='_blank'>Money or Barter?</a></p><p>Teach students the characteristics of money and barter with this interactive tool. Students will be asked to categorize statements as money, barter, or both.<br><font size="-10"><br /></font><font size="-3">Date Published: 06/08/2012<br>Grades: 3-5<br />Source: <a href='http://www.econedlink.org/' target='_blank'>EconEdLink.org</a></font></p><br><p><font color="#CC6666">Video</font> <a href='http://www.econedlink.org/i226' target='_blank'>Foreign Currency Markets/Exchange Rates</a></p><p>This video teaches the concepts of Foreign Currency Markets and Exchange Rates. The foreign currency market is where one currency is exchanged for another. An exchange rate is the actual rate of conversion between two currencies.<br><font size="-10"><br /></font><font size="-3">Date Published: 07/12/2012<br>Grades: 3-5, 6-8, 9-12<br />Source: <a href='http://www.econedlink.org/' target='_blank'>EconEdLink.org</a></font></p><br><p><font color="#CC6666">Video</font> <a href='http://www.econedlink.org/i189' target='_blank'>Money</a></p><p>This video teaches the concept of Money. Money is anything that is used to buy and sell goods and services. In different times and places, many different items have served as money: gold, silver, shells, cattle, tobacco and printed paper currency.<br><font size="-10"><br /></font><font size="-3">Date Published: 07/12/2012<br>Grades: 3-5, 6-8, 9-12<br />Source: <a href='http://www.econedlink.org/' target='_blank'>EconEdLink.org</a></font></p><br><p><font color="#CC6666">Video</font> <a href='http://www.econedlink.org/i206' target='_blank'>Monetary Policy and the Federal Reserve</a></p><p>This video teaches the concepts of Monetary Policy and the Federal Reserve. Monetary policy involves regulating the money supply, banks and the overall financial system. Monetary policy is conducted by a central bank, which in the United States is...<br><font size="-10"><br /></font><font size="-3">Date Published: 07/12/2012<br>Grades: 3-5, 6-8, 9-12<br />Source: <a href='http://www.econedlink.org/' target='_blank'>EconEdLink.org</a></font></p><br><p><font color="#CC6666">Flash</font> <a href='http://www.econedlink.org/i250' target='_blank'>Costs and Benefits of Saving</a></p><p>Teach students the costs and benefits of saving money.<br><font size="-10"><br /></font><font size="-3">Date Published: 06/14/2012<br>Grades: 3-5<br />Source: <a href='http://www.econedlink.org/' target='_blank'>EconEdLink.org</a></font></p><br><p>-------------------------------------</p><p><b>Lessons:</b></p><br><p><a href='http://www.econedlink.org/e563' target='_blank'>Agent Pincher: P is for Penny or Where did money come from?</a></p><p>Over time everyone has had a pocketful of pennies, it’s not something we think about very much. But what if we woke up tomorrow and found that there were no more pennies? Or what if we found that money had disappeared altogether -- not only from our pockets but from banks, stores and all the other places where we would expect to find it? While we are on the subject, just what is this thing called money? Everyone knows about money--or do they? Where did it come from? Why are a piece of paper and a metal disk money? Why not something else? Just how did this dollar or dime wind up in my pocket? This lesson will send your students on a mission to investigate the history of money. In a wrap-up activity, it will call upon the students to consider whether we should keep or toss the penny.<br><font size="-10"><br /></font><font size="-3">Date Published: 04/18/2005<br />Grades: 6-8<br />Source: <a href='http://www.econedlink.org/' target='_blank'>EconEdLink.org</a></font></p><br><p><a href='http://www.econedlink.org/e460' target='_blank'>No Funny Money, Honey....I Want the Real Thing!</a></p><p>Do you know what funny money is? It's NOT the real thing! Find out how our government tries to make our money hard to copy in this lesson about real and fake money.<br><font size="-10"><br /></font><font size="-3">Date Published: 07/02/2003<br />Grades: K-2, 3-5<br />Source: <a href='http://www.econedlink.org/' target='_blank'>EconEdLink.org</a></font></p><br><p><a href='http://www.econedlink.org/e66' target='_blank'>The Story of Jack and the Bank Stalk</a></p><p>Fairy tales have always been used to give lessons about life. The story of Jack and the Bean Stalk is a good lesson about the importance of knowing about money and banks. The story of Jack asks the question, "What is money?"<br><font size="-10"><br /></font><font size="-3">Date Published: 12/31/1999<br />Grades: 3-5<br />Source: <a href='http://www.econedlink.org/' target='_blank'>EconEdLink.org</a></font></p><br><p><a href='http://www.econedlink.org/e750' target='_blank'>What Is Money? Why Does It Have Value?</a></p><p>In this lesson, students consider the fact that the value of money differs depending on where the money is being spent. In order to understand this idea, students will first develop a deeper understanding of what it means for money to have a value. They will then consider that different goods and services cost different amounts of money in different regions of the world. Finally, students develop an understanding that the value of a dollar is determined by where the dollar is spent.<br><font size="-10"><br /></font><font size="-3">Date Published: 11/26/2008<br />Grades: 6-8<br />Source: <a href='http://www.econedlink.org/' target='_blank'>EconEdLink.org</a></font></p><br><p><a href='http://www.econedlink.org/e61' target='_blank'>Pennies Make Cents</a></p><p>Students will review the history of trade before money and will investigate the history of money. Students will locate information about the first coin authorized by the United States and will learn about the penny.<br><font size="-10"><br /></font><font size="-3">Date Published: 12/24/1999<br />Grades: 3-5<br />Source: <a href='http://www.econedlink.org/' target='_blank'>EconEdLink.org</a></font></p><br>]]></resources>
<related>
<concept>15</concept>
</related>
<quiz>1</quiz>
</concept>
<concept>
<id>43</id>
<name>Money Management/Budgeting</name>
<category>4</category>
<definition><![CDATA[<p><b>Budgeting</b> refers to drawing up a plan for how available funds will be spent. A typical approach is to write down the total <a href="event:function=defineGlossaryTerm,Income">income</a> that you expect to have available to <a href="event:function=defineGlossaryTerm,Spend">spend</a>, and then to write down how you plan to spend it. Budgeting helps you know where your <a href="event:function=defineGlossaryTerm,Money">money</a> is actually going, which in turn helps you to make more informed decisions about how you would prefer to spend your money. Sound money management is rational <a href="event:function=defineGlossaryTerm,Decision Making">decision making</a>, which involves weighing the anticipated <a href="event:function=defineGlossaryTerm,Costs">costs</a> and <a href="event:function=defineGlossaryTerm,Benefit">benefits</a> of a decision. Budgeting helps make clear that cutbacks in one area of spending might be worth making, because they can pay for increases in other more desired areas. Budgeting is sometimes called <a href="event:function=defineGlossaryTerm,Money Management"><b>money management</b></a>, since it involves clarifying decisions about how available income will be spent. </p>]]></definition>
<lessons><![CDATA[<p>Below are <b>featured</b> lessons for teaching Money Management/Budgeting.</p><br><p class="tipHeading">High School Lessons</p><p>--------------------------------------------------------------------</p><p><a href="event:function=viewLesson,68294"><b>Theme 3: Lesson 8 - Managing Your Money</b></a><br><a href="event:function=viewPublication,138">Financial Fitness for Life: 9-12 - Teacher Guide</a></p><br><p class="smaller_text">This lesson introduces some basics of money management. By means of a radio call-in show script, students learn about setting up a family budget and distinguishing between income and net worth. To practice making budgeting decisions, the students ...</p><br><p>--------------------------------------------------------------------</p><p><a href="event:function=viewLesson,67757"><b>Lesson 31: Did the New Deal Help or Harm the Recovery?</b></a><br><a href="event:function=viewPublication,105">Focus: Understanding Economics in U.S. History</a></p><br><p class="smaller_text">Note to the teacher: This lesson is closely tied to the preceding lesson, Whatdunnit? The Great Depression Mystery. The students in groups analyze the New Deal to determine whether individual policies helped end the depression by increasing aggreg...</p><br><p>--------------------------------------------------------------------</p><p><a href="event:function=viewLesson,17812"><b>Unit 3: Lesson 18 - Credit Management</b></a><br><a href="event:function=viewPublication,1">Capstone: Exemplary Lessons for High School Economics - Teacher's Guide</a></p><br><p class="smaller_text">This lesson is designed to help students make good consumer-credit decisions. Although using credit is beneficial at times, it often carries higher costs than many people realize. This lesson discusses the costs of credit in a manner that helps ...</p><br><p>--------------------------------------------------------------------</p><p><a href="event:function=viewLesson,17811"><b>Unit 3: Lesson 17 - Creating and Using a Budget</b></a><br><a href="event:function=viewPublication,1">Capstone: Exemplary Lessons for High School Economics - Teacher's Guide</a></p><br><p class="smaller_text">This lesson focuses on using budgeting to maximize consumer satisfaction. It describes a flexible view of budgets, linking them to markets and market information, and demonstrates how and why budgets should be reviewed and modified often.</p><br><p>--------------------------------------------------------------------</p><p><a href="event:function=viewLesson,62446"><b>Lesson 6 - Financial Planning: Budgeting Your Financial Resources</b></a><br><a href="event:function=viewPublication,73">Personal Decision Making: Focus on Economics</a></p><br><p class="smaller_text">Students participate in a motivational activity in which they evaluate the costs and benefits of impulse buying and its effect on living on a limited income. After they analyze a sample budget, students develop their own budget that might be appr...</p><br> <p>--------------------------------------------------------------------</p><p><a href="event:function=viewLesson,707"><b><font color="#CC6666">Online Lesson:</font> The Five Stages of Investing</b></a><br><a href='http://www.econedlink.org/' target='_blank'>EconEdLink.org</a></p><br><p class="smaller_text">The practice of saving and investing is definitely a good thing, but there are many ways to save and invest. In thinking about the options, it is important to consider the degree of risk involved and the potential for return. Typically, the highe...</p><br><p>--------------------------------------------------------------------</p><p><a href="event:function=viewLesson,691"><b><font color="#CC6666">Online Lesson:</font> Banks & Credit Unions (Part I)</b></a><br><a href='http://www.econedlink.org/' target='_blank'>EconEdLink.org</a></p><br><p class="smaller_text">Students learn about banks and credit unions, identifying similarities and differences between the two types of financial institution. They also evaluate a local bank and credit union to determine which one would be better suited to their needs. (...</p><br><p>--------------------------------------------------------------------</p><p><a href="event:function=viewLesson,388"><b><font color="#CC6666">Online Lesson:</font> Show Me the Money!</b></a><br><a href='http://www.econedlink.org/' target='_blank'>EconEdLink.org</a></p><br><p class="smaller_text">Students will investigate unforseen costs of car loans and/or house loans. They will then evaluate the economics of decision making, the ramifications of their choices, and options available to them. Students will compute costs and savings fo...</p><br><p>--------------------------------------------------------------------</p><p><a href="event:function=viewLesson,346"><b><font color="#CC6666">Online Lesson:</font> Q T Pi Fashions - Learning About Credit Card Use</b></a><br><a href='http://www.econedlink.org/' target='_blank'>EconEdLink.org</a></p><br><p class="smaller_text">Credit cards are convenient, user friendly, and at times dangerous. In this lesson students learn the joys and dangers of using credit as they help Credit, the main character in this activity, solve her credit problems.</p><br><p>--------------------------------------------------------------------</p><p><a href="event:function=viewLesson,305"><b><font color="#CC6666">Online Lesson:</font> Wages and Me</b></a><br><a href='http://www.econedlink.org/' target='_blank'>EconEdLink.org</a></p><br><p class="smaller_text">Students explore the reasons for differences in the wages for several occupations. Then students are guided through the Bureau of Labor Statistics website to find information about their potential careers and wage rates nationally and in thei...</p><br><p>--------------------------------------------------------------------</p><p><a href="event:function=viewLesson,8303"><b><font color="#CC6666">Online Lesson:</font> Budget Odyssey</b></a><br><a href='http://www.econedlink.org/' target='_blank'>EconEdLink.org</a></p><br><p class="smaller_text">Students will begin the Budget Odyssey driving a minibus to Budget Balancing Bliss via a board game. Students will answer questions about income, fixed expenses, and variable expenses. Once the student reaches the end of the board game the player ...</p><br><p class="tipHeading">Middle School Lessons</p><p>--------------------------------------------------------------------</p><p><a href="event:function=viewLesson,68238"><b>Theme 3: Lesson 7 - Managing Cash</b></a><br><a href="event:function=viewPublication,136">Financial Fitness for Life: Grades 6-8 - Teacher Guide</a></p><br><p class="smaller_text">Although most middle school and junior high students do not hold full-time jobs, many of them have money to spend, often from an allowance or a part-time job. As a group, they have discretionary income that totals, by some estimates, billions of d...</p><br><p>--------------------------------------------------------------------</p><p><a href="event:function=viewLesson,67878"><b>Lesson 9 - Bulletin-Board Banking</b></a><br><a href="event:function=viewPublication,115">Focus: Economics - Grades 3-5</a></p><br><p class="smaller_text">In this lesson, the students participate in activities that demonstrate the role of banks in a community. They learn that banks facilitate community growth by receiving funds from savers and transferring a portion of those funds to borrowers. Th...</p><br><p>--------------------------------------------------------------------</p><p><a href="event:function=viewLesson,15857"><b>Lesson 12 - Charting a Budget</b></a><br><a href="event:function=viewPublication,3">Mathematics & Economics: Connections for Life - 6-8</a></p><br><p class="smaller_text">In this lesson, students learn what a budget is. They construct a pie chart to show the distribution of expenses in a budget. They learn about payroll deductions and determine the impact that payroll deductions have on a budget. Finally, they lear...</p><br><p>--------------------------------------------------------------------</p><p><a href="event:function=viewLesson,62644"><b>Lesson 14 - No Free Lunch</b></a><br><a href="event:function=viewPublication,49">Focus: Middle School Economics</a></p><br><p class="smaller_text">Students use a decision tree to analyze a budget problem at a public school</p><br> <p>--------------------------------------------------------------------</p><p><a href="event:function=viewLesson,792"><b><font color="#CC6666">Online Lesson:</font> Staying Afloat Financially in the 21st Century</b></a><br><a href='http://www.econedlink.org/' target='_blank'>EconEdLink.org</a></p><br><p class="smaller_text">This lesson will help students identify how to make good decisions which will help them financially in the future. Students will identify how to take their own wants and work them into a form of a personal budget. Students will also discuss vari...</p><br><p>--------------------------------------------------------------------</p><p><a href="event:function=viewLesson,157"><b><font color="#CC6666">Online Lesson:</font> A Penny Saved is a Penny at 4.7% Earned</b></a><br><a href='http://www.econedlink.org/' target='_blank'>EconEdLink.org</a></p><br><p class="smaller_text">There are lots of ways to receive income, and lots of ways to spend it. In this EconomicsMinute you will develop two budgets, or plans, to help you decide how to allocate your income. Assuming you do not love making dollar bill rings.</p><br><p class="tipHeading">Elementary Lessons</p><p>--------------------------------------------------------------------</p><p><a href="event:function=viewLesson,68212"><b>Theme 5: Lesson 16 - We Manage Our Money</b></a><br><a href="event:function=viewPublication,131">Financial Fitness for Life: K-2 - Teacher Guide</a></p><br><p class="smaller_text">Participating in a game, the students demonstrate their knowledge of basic money management concepts, including income, spending, saving, and credit. They review these concepts and write about what they have learned, using a graphic organizer.</p><br><p>--------------------------------------------------------------------</p><p><a href="event:function=viewLesson,68211"><b>Theme 5: Lesson 15 - We Make a Budget</b></a><br><a href="event:function=viewPublication,131">Financial Fitness for Life: K-2 - Teacher Guide</a></p><br><p class="smaller_text">The lesson introduces budgets and budgeting. The students participate in an activity in which they balance a budget by manipulating income and expense cards.</p><br><p>--------------------------------------------------------------------</p><p><a href="event:function=viewLesson,68206"><b>Theme 3: Lesson 10 - We Plan for Spending</b></a><br><a href="event:function=viewPublication,131">Financial Fitness for Life: K-2 - Teacher Guide</a></p><br><p class="smaller_text">The students explore planned and unplanned spending. They construct traffic lights and use them as props in describing consumers' spending decisions as planned or unplanned. They discuss the costs and benefits of spending decisions.</p><br><p>--------------------------------------------------------------------</p><p><a href="event:function=viewLesson,68178"><b>Theme 4: Lesson 15 - It's a Balancing Act</b></a><br><a href="event:function=viewPublication,134">Financial Fitness for Life: Grades 3-5 - Teacher Guide</a></p><br><p class="smaller_text">The students use manipulatives to learn about income, expenses (fixed and variable), and budgeting.</p><br><p>--------------------------------------------------------------------</p><p><a href="event:function=viewLesson,68177"><b>Theme 4: Lesson 14 - Managing Money</b></a><br><a href="event:function=viewPublication,134">Financial Fitness for Life: Grades 3-5 - Teacher Guide</a></p><br><p class="smaller_text">The students examine cases in which income is limited and people must therefore make choices about how to manage their money.</p><br><p>--------------------------------------------------------------------</p><p><a href="event:function=viewLesson,67116"><b>Lesson 4: Pizza on a Budget</b></a><br><a href="event:function=viewPublication,102">Mathematics & Economics: Connections for Life - 3-5</a></p><br><p class="smaller_text">This lesson focuses on budgeting (economics) and basic operations (mathematics). The students participate in a mouth-watering budget activity while they use estimating skills and practice identifying costs and benefits. Using a budget work sheet, ...</p><br><p>--------------------------------------------------------------------</p><p><a href="event:function=viewLesson,61985"><b>Lesson 4: Why Do People Go to School?</b></a><br><a href="event:function=viewPublication,101">Learning, Earning and Investing: Grades 4-5 Lessons</a></p><br><p class="smaller_text">The students look at a simple chart relating education level with average annual income. From the data the students generalize that people with more education usually earn more income. They learn that human capital refers to the knowledge, skills,...</p><br> <p>--------------------------------------------------------------------</p><p><a href="event:function=viewLesson,584"><b><font color="#CC6666">Online Lesson:</font> You Can BANK on This! (Part 2)</b></a><br><a href='http://www.econedlink.org/' target='_blank'>EconEdLink.org</a></p><br><p class="smaller_text">As in the first 'You Can BANK on This,' you will learn that banking should not be confusing - it should be INTERESTING! Lesson Two will continue learning with Zing, but this time we will learn all about budgeting - and budgeting means making choi...</p><br><p>--------------------------------------------------------------------</p><p><a href="event:function=viewLesson,483"><b><font color="#CC6666">Online Lesson:</font> Money Comes and Goes</b></a><br><a href='http://www.econedlink.org/' target='_blank'>EconEdLink.org</a></p><br><p class="smaller_text">Students read two online stories that introduce them to the elements of a budget and show that a successful budget balances money coming in (income) with money going out (expenses and savings). Follow-up activities point out the value of a budget....</p><br><p>--------------------------------------------------------------------</p><p><a href="event:function=viewLesson,455"><b><font color="#CC6666">Online Lesson:</font> Big Banks, Piggy Banks</b></a><br><a href='http://www.econedlink.org/' target='_blank'>EconEdLink.org</a></p><br><p class="smaller_text">When choosing a place to put their money, people consider how safe there money will be, how easy it is to access, and whether it will earn more money. Students explore how well different savings places achieve these objectives. Students learn...</p><br><p>--------------------------------------------------------------------</p><p><a href="event:function=viewLesson,361"><b><font color="#CC6666">Online Lesson:</font> Clickety Clack, Let's Keep Track!</b></a><br><a href='http://www.econedlink.org/' target='_blank'>EconEdLink.org</a></p><br><p class="smaller_text">This lesson will show students the importance of keeping track of their savings.</p><br>]]></lessons>
<tips><![CDATA[<p class="tipHeading">Tip #1</p><p>Having your students complete a consumer project is a good way to teach money-management and budgeting skills. Have each student choose an educational and occupational level that he or she feels is realistic to achieve. Then assign an income based on the starting salary for that occupation. The student then must budget that income for his or her first year of work. To develop a budget, the students must contact local merchants and engage in such activities as buying a home (with consideration given to how to finance it, the real estate tax, homeowner's insurance and estimated operating expenses) or renting an apartment (with consideration given to renter's insurance and estimated operating expenses); buying a car (with consideration given to the selling price, trade-in allowances, taxes and the annual percentage rate on loans); comparing the credit plans of two stores; comparing auto insurance rates; developing savings plans; and filling out state and federal tax forms. During the activity the students will learn that budgets cannot always account for unexpected risks such as auto accidents, lay-offs and property damage. These situations can be illustrated by having the students draw "cards of doom" and adjusting their budgets accordingly.</p><br><p class="tipHeading">Tip #2</p><p>Although budgeting can seem complex, building wealth for the future requires getting control of spending so that you are able to save. Simplify the process with the simple rule: "Spend less than you earn." As Charles Dickens wrote in <i>David Copperfield</i>:<br><br><i><textformat leftmargin="25">"My other piece of advice, Copperfield," said Mr. Micawber, "you know. Annual income twenty pounds, annual expenditure nineteen nineteen six, result happiness. Annual income twenty pounds, annual expenditure twenty pounds ought and six, result misery."</textformat></i></p><br><p class="tipHeading">Tip #3</p><p>Ask younger students this question:<br><br>Your family has agreed to pay you $10 per week for doing chores at home, such as washing dishes, folding laundry and vacuuming. This $10 would be your income. Would $10 be enough to buy all the goods and services you want in a week and to allow you to save for goods and services you want in the future?<br><br>If the answer is no, have them budget their $10 income.</p><br>]]></tips>
<resources><![CDATA[<p><b>Interactive tools:</b><br /></p><p><font color="#CC6666">Flash</font> <a href='http://www.econedlink.org/i145' target='_blank'>Budget Odyssey</a></p><p>In this game, students click the spinner to see how far their car will advance. After each spin, they will be asked to categorize expenses. If they get it right, they'll be one step closer to winning. But if they get it wrong, they're sent backwards.<br><font size="-10"><br /></font><font size="-3">Date Published: 02/16/2011<br>Grades: 6-8, 9-12<br />Source: <a href='http://www.econedlink.org/' target='_blank'>EconEdLink.org</a></font></p><br><p><font color="#CC6666">Video</font> <a href='http://www.econedlink.org/i265' target='_blank'>Never Too Young: Personal Finance for Young Learners</a></p><p>This program was developed in response to a growing interest in teaching students about personal finance through settings outside of the traditional school day. The program teaches young students about financial choices, cost‐benefit analysis fo...<br><font size="-10"><br /></font><font size="-3">Date Published: 10/19/2012<br>Grades: K-2, 3-5<br />Source: <a href='http://www.econedlink.org/' target='_blank'>EconEdLink.org</a></font></p><br><p><font color="#CC6666">Video</font> <a href='http://www.econedlink.org/i228' target='_blank'>Credit</a></p><p>This video teaches the concept of Credit. Credit refers to the ability to borrow money. Some forms of credit commonly used by consumers are car loans, home mortgage loans and credit cards.<br><font size="-10"><br /></font><font size="-3">Date Published: 07/12/2012<br>Grades: 6-8, 9-12<br />Source: <a href='http://www.econedlink.org/' target='_blank'>EconEdLink.org</a></font></p><br><p><font color="#CC6666">Video</font> <a href='http://www.econedlink.org/i231' target='_blank'>Insurance</a></p><p>This video teaches the concept of Insurance. The purchase of insurance involves paying an amount called a premium at regular intervals, with the understanding that if negative events occur, the insurance company will pay certain costs.<br><font size="-10"><br /></font><font size="-3">Date Published: 07/12/2012<br>Grades: 6-8, 9-12<br />Source: <a href='http://www.econedlink.org/' target='_blank'>EconEdLink.org</a></font></p><br><p><font color="#CC6666">Video</font> <a href='http://www.econedlink.org/i232' target='_blank'>Money Management/Budgeting</a></p><p>This video teaches the concepts of Money Management and Budgeting. Budgeting refers to drawing up a plan for how available funds will be spent. Budgeting is sometimes called money management, since it involves clarifying decisions about how availa...<br><font size="-10"><br /></font><font size="-3">Date Published: 07/12/2012<br>Grades: 3-5, 6-8, 9-12<br />Source: <a href='http://www.econedlink.org/' target='_blank'>EconEdLink.org</a></font></p><br><p>-------------------------------------</p><p><b>Lessons:</b></p><br><p><a href='http://www.econedlink.org/e162' target='_blank'>Buying vs. Renting</a></p><p>Have you given any thought to where you will live when you are "on your own" - out in the world earning a living? You will have many decisions to make as you look for a place to call home. In this lesson, your basic economic decision making skills will be used to weigh the pros and cons of home ownership, and to analyze housing options. It's time to find out what is right for YOU.<br><font size="-10"><br /></font><font size="-3">Date Published: 09/29/2000<br />Grades: 9-12<br />Source: <a href='http://www.econedlink.org/' target='_blank'>EconEdLink.org</a></font></p><br><p><a href='http://www.econedlink.org/e45' target='_blank'>Trish and Scott's Big Adventure: An Investigation of Regional Housing Costs</a></p><p>This lesson has students explore differences in regional housing costs, determine the percentage of gross income spent on housing, assess the impact of housing costs on a relocation decision and recognize wages and housing costs are prices.<br><font size="-10"><br /></font><font size="-3">Date Published: 11/03/1999<br />Grades: 6-8, 9-12<br />Source: <a href='http://www.econedlink.org/' target='_blank'>EconEdLink.org</a></font></p><br><p><a href='http://www.econedlink.org/e1013' target='_blank'>Using an Excel Checkbook</a></p><p>Students will use a spreadsheet to enter checkbook transactions and reconcile.<br><font size="-10"><br /></font><font size="-3">Date Published: 12/18/2011<br />Grades: 9-12<br />Source: <a href='http://www.econedlink.org/' target='_blank'>EconEdLink.org</a></font></p><br><p><a href='http://www.econedlink.org/e702' target='_blank'>Work, Earnings and Economics: Using 'Lyddie' by Katherine Paterson</a></p><p>To get started, the students will read Lyddie, a novel by Katherine Paterson. The novel is set mainly in Lowell, Massachusetts, in the 1840s. In Lowell the main character, 13-year-old Lyddie Worthen, works six days a week, from dawn until dusk, running weaving looms in a murky dust-and lintfilled factory, trying to save enough money to reunite her family. In reading and discussing this fine novel, the students examine basic economic concepts and explore the growth of labor unions and the role of government in a market economy.
Lyddie is published by Puffin Books and is available at Amazon.com. It is also available in DVD video format and may be purchased on line at Circuit City, DVD Empire.com and Overstock.com.<br><font size="-10"><br /></font><font size="-3">Date Published: 09/13/2007<br />Grades: 6-8<br />Source: <a href='http://www.econedlink.org/' target='_blank'>EconEdLink.org</a></font></p><br><p><a href='http://www.econedlink.org/e483' target='_blank'>Money Comes and Goes</a></p><p>Students read two online stories that introduce them to the elements of a budget and show that a successful budget balances money coming in (income) with money going out (expenses and savings). Follow-up activities point out the value of a budget. Students learn that a budget can help us make sure we buy the things we really need and want. A budget can also help us save for things that we can’t afford to buy right now. In a culminating activity, students create a budget they could use to achieve a savings goal.<br><font size="-10"><br /></font><font size="-3">Date Published: 02/04/2004<br />Grades: 3-5<br />Source: <a href='http://www.econedlink.org/' target='_blank'>EconEdLink.org</a></font></p><br>]]></resources>
<related>
<concept>46</concept>
<concept>47</concept>
<concept>64</concept>
</related>
<quiz>1</quiz>
</concept>
<concept>
<id>10</id>
<name>Opportunity Cost</name>
<category>0</category>
<definition><![CDATA[<p><b>Opportunity cost</b> is what you must give up to obtain something else, the second-best <a href="event:function=defineGlossaryTerm,Alternative">alternative</a>. However, what you must give up to obtain, say, a bicycle is not really <a href="event:function=defineGlossaryTerm,Money">money</a>--it is whatever other <a href="event:function=defineGlossaryTerm,Goods">good</a> or <a href="event:function=defineGlossaryTerm,Services">service</a> you would have spent the money on as your next-favorite <a href="event:function=defineGlossaryTerm,Choice">choice</a>. Similarly, what a government gives up to obtain, say, more educational services is not really money either--it is whatever alternative goods or services the government could have purchased instead, or the goods and services that individuals might have purchased if their <a href="event:function=defineGlossaryTerm,Taxes">taxes</a> had been lower. </p> <br><p><a href="event:function=defineGlossaryTerm,Opportunity Cost">Opportunity cost</a> includes all <a href="event:function=defineGlossaryTerm,Costs">costs</a>, including those of time or alternative activities. For example, one part of the opportunity cost of attending college is the money that could have been spent on something else, but another part is the cost in terms of time or alternative activities, when a student could have been working and earning <a href="event:function=defineGlossaryTerm,Income">income</a>. As a different example, the opportunity cost for a <a href="event:function=defineGlossaryTerm,Business">business</a> of holding a three-hour meeting with 30 employees attending isn't an additional monetary cost, since they are paying the employees already; instead, the opportunity cost of the meeting is the work that could have been accomplished if people hadn't had to attend the meeting. The opportunity cost of the meeting is the next-best alternative use of the time spent at the meeting.</p>]]></definition>
<lessons><![CDATA[<p>Below are <b>featured</b> lessons for teaching Opportunity Cost.</p><br><p class="tipHeading">High School Lessons</p><p>--------------------------------------------------------------------</p><p><a href="event:function=viewLesson,67743"><b>Lesson 17: Free the Enslaved and Avoid the War</b></a><br><a href="event:function=viewPublication,105">Focus: Understanding Economics in U.S. History</a></p><br><p class="smaller_text">This lesson calls upon students to role-play people who were sympathetic to slaveholding. Be certain to remind the students not to confuse statements made during the role playing with the actual beliefs of the students assuming the roles. The inte...</p><br><p>--------------------------------------------------------------------</p><p><a href="event:function=viewLesson,67637"><b>Lesson 2 - Why People Trade, Domestically and Internationally</b></a><br><a href="event:function=viewPublication,109">Focus: Globalization</a></p><br><p class="smaller_text">Students participate in a trading game and discuss why people trade. Then they apply the concept of comparative advantage to two hypothetical situations involving individuals and countries. They learn why both parties in voluntary trades can benef...</p><br><p>--------------------------------------------------------------------</p><p><a href="event:function=viewLesson,60317"><b>Lesson 5 - Scarcity and Choice</b></a><br><a href="event:function=viewPublication,38">Old MacDonald to Uncle Sam: Lesson Plans from Writers around the World</a></p><br><p class="smaller_text">In this lesson, students participate in a role play as producers of two goods, allowing students to experience scarcity. They make choices about using their scarce resource to produce both or one of two goods. Then they construct production-poss...</p><br><p>--------------------------------------------------------------------</p><p><a href="event:function=viewLesson,15427"><b>Lesson 6 - The Economic Way of Thinking: Three Activities to Demonstrate Marginal Analysis</b></a><br><a href="event:function=viewPublication,2">Economics in Action: 14 Greatest Hits for Teaching High School Economics</a></p><br><p class="smaller_text">This lesson consists of three activities that demonstrate different applications of marginal analysis. You may use the activities separately or do them together in one class period. In the first activity, the students produce a good and demonstrat...</p><br><p>--------------------------------------------------------------------</p><p><a href="event:function=viewLesson,20821"><b>Lesson 7: The Mathematics of Nonlinear Economic Shapes: The Production Possibilities Curve</b></a><br><a href="event:function=viewPublication,11">Mathematics & Economics: Connections for Life - 9-12</a></p><br><p class="smaller_text">Because the resources (such as raw materials, minerals, energy, labor, equipment, machinery, etc.) that are used to produce goods and services are limited in their availability, we cannot have all that we want. When limited resources come into con...</p><br><p>--------------------------------------------------------------------</p><p><a href="event:function=viewLesson,62442"><b>Lesson 2 - Applying a Decision-Making Model: You and Your Future</b></a><br><a href="event:function=viewPublication,73">Personal Decision Making: Focus on Economics</a></p><br><p class="smaller_text">Students participate in a group activity using the decision-making grid. They learn why two individuals may reach different decisions even when they use an identical decision-making model. This lesson helps students appreciate different points o...</p><br> <p>--------------------------------------------------------------------</p><p><a href="event:function=viewLesson,759"><b><font color="#CC6666">Online Lesson:</font> Marketplace: School Competition</b></a><br><a href='http://www.econedlink.org/' target='_blank'>EconEdLink.org</a></p><br><p class="smaller_text">In June 2002, the Supreme Court ruled that Cleveland's system of giving students vouchers to attend private or religious schools did not violate the constitutional separation of church and state. In this lesson, students listen to an audio file ab...</p><br><p>--------------------------------------------------------------------</p><p><a href="event:function=viewLesson,463"><b><font color="#CC6666">Online Lesson:</font> College: Where am I going to go?</b></a><br><a href='http://www.econedlink.org/' target='_blank'>EconEdLink.org</a></p><br><p class="smaller_text">Students will use a PACED decision making grid to help them decide where they would like to attend college.</p><br><p>--------------------------------------------------------------------</p><p><a href="event:function=viewLesson,386"><b><font color="#CC6666">Online Lesson:</font> Car Loan Project</b></a><br><a href='http://www.econedlink.org/' target='_blank'>EconEdLink.org</a></p><br><p class="smaller_text">Each student will buy (hypothetically) a car that will need to be financed. The student will need to look at different options and decide which will be the best choice for his situation. The student will need to find an advertisement for a ca...</p><br><p class="tipHeading">Middle School Lessons</p><p>--------------------------------------------------------------------</p><p><a href="event:function=viewLesson,68233"><b>Theme 1: Lesson 2 - Making Decisions</b></a><br><a href="event:function=viewPublication,136">Financial Fitness for Life: Grades 6-8 - Teacher Guide</a></p><br><p class="smaller_text">This lesson builds on Lesson 1, introducing students to points 3 and 4 of The Economic Way of Thinking: People must make choices, and Every choice involves a cost. In activities related to these points, the students practice using the PACED decisi...</p><br><p>--------------------------------------------------------------------</p><p><a href="event:function=viewLesson,67916"><b>Unit 3: Water Resources</b></a><br><a href="event:function=viewPublication,107">Energy, Economics, and the Environment: Case Studies and Teaching Activities for Elementary School</a></p><br><p class="smaller_text">In this unit, students explore the value of our water resources. Students learn how water resources can become polluted and they investigate the costs involved in cleanup. Students also learn that it is impractical to have perfectly clean water, a...</p><br><p>--------------------------------------------------------------------</p><p><a href="event:function=viewLesson,60332"><b>Lesson 2 - How Much Depends on Where</b></a><br><a href="event:function=viewPublication,53">Middle School World Geography: Focus on Economics</a></p><br><p class="smaller_text">In this lesson, the students learn how the geography of a country can influence where goods are produced. The students use a map of a fictitious country to enhance their map skills. They derive geographic information from the map, use a scale to d...</p><br><p>--------------------------------------------------------------------</p><p><a href="event:function=viewLesson,15852"><b>Lesson 7 - Which Pet is Right for You?</b></a><br><a href="event:function=viewPublication,3">Mathematics & Economics: Connections for Life - 6-8</a></p><br><p class="smaller_text">This lesson focuses on a topic that is at the heart of economics, that of decision making. Decision making from an economic perspective requires individuals to consider both the benefits and costs for each alternative. Human nature, however, often...</p><br><p>--------------------------------------------------------------------</p><p><a href="event:function=viewLesson,62632"><b>Lesson 2 - Give and Take</b></a><br><a href="event:function=viewPublication,49">Focus: Middle School Economics</a></p><br><p class="smaller_text">After reading about a problem, students identify alternative solutions, trade-offs make in choosing each alternative, and the opportunity cost of selecting each option. Students describe trade-offs and create a graphic to represent alternatives a...</p><br> <p>--------------------------------------------------------------------</p><p><a href="event:function=viewLesson,789"><b><font color="#CC6666">Online Lesson:</font> You're Going to College</b></a><br><a href='http://www.econedlink.org/' target='_blank'>EconEdLink.org</a></p><br><p class="smaller_text">The students will explore the costs and the benefits of going to college. They participate in a three-part game designed to help them understand the decisions associated with attending college and the benefits available to college graduates.</p><br><p>--------------------------------------------------------------------</p><p><a href="event:function=viewLesson,51"><b><font color="#CC6666">Online Lesson:</font> The Opportunity Cost of a Lifetime</b></a><br><a href='http://www.econedlink.org/' target='_blank'>EconEdLink.org</a></p><br><p class="smaller_text">All economic questions and problems arise from scarcity. Economics assumes people do not have the resources do satisfy all of their wants. Therefore, we must make choices about how to allocate those resources. We make decisions about how to s...</p><br><p class="tipHeading">Elementary Lessons</p><p>--------------------------------------------------------------------</p><p><a href="event:function=viewLesson,68203"><b>Theme 2: Lesson 7 - Saving Makes Us Wait</b></a><br><a href="event:function=viewPublication,131">Financial Fitness for Life: K-2 - Teacher Guide</a></p><br><p class="smaller_text">In a simulation activity, the students set a goal and save money to achieve that goal. They discuss the costs and benefits of saving by completing a decision grid. Using a magic mirror, they gaze into the future and imagine things they will want t...</p><br><p>--------------------------------------------------------------------</p><p><a href="event:function=viewLesson,68200"><b>Theme 2: Lesson 4 - Money Lets Us Choose</b></a><br><a href="event:function=viewPublication,131">Financial Fitness for Life: K-2 - Teacher Guide</a></p><br><p class="smaller_text">The students listen to a short story that introduces difficulties involved in making choices. Using a grid, the students discuss costs and benefits as they make choices. (The class uses an apron as a prop in making decisions, here and in future le...</p><br><p>--------------------------------------------------------------------</p><p><a href="event:function=viewLesson,68170"><b>Theme 3: Lesson 7 - To Choose Is to Refuse</b></a><br><a href="event:function=viewPublication,134">Financial Fitness for Life: Grades 3-5 - Teacher Guide</a></p><br><p class="smaller_text">By participating in a readers' theater activity, the students learn about opportunity cost as a key factor in decision making. They use the concept of opportunity cost in a related simulation activity, deciding which wants to satisfy with limited ...</p><br><p>--------------------------------------------------------------------</p><p><a href="event:function=viewLesson,68167"><b>Theme 2: Lesson 4 - The Grasshopper and the Ant</b></a><br><a href="event:function=viewPublication,134">Financial Fitness for Life: Grades 3-5 - Teacher Guide</a></p><br><p class="smaller_text">In reading and discussing an adaptation of Aesop's fable 'The Grasshopper and the Ant,' the students learn about the trade-off between satisfying wants today and planning for the future. They use the fable to examine their own behavior and decisio...</p><br><p>--------------------------------------------------------------------</p><p><a href="event:function=viewLesson,67929"><b>Lesson 8: Uncle Jed's Barbershop</b></a><br><a href="event:function=viewPublication,116">Teaching Economics Using Children's Literature</a></p><br><p class="smaller_text">Uncle Jed's Barbershop is a heartwarming story about a barber who travels the countryside cutting poor folks' hair. Uncle Jed has a kind heart and a giving spirit. He lives for the day that he can own his own barbershop. It takes a long time an...</p><br><p>--------------------------------------------------------------------</p><p><a href="event:function=viewLesson,67121"><b>Lesson 9: How Much Time?</b></a><br><a href="event:function=viewPublication,102">Mathematics & Economics: Connections for Life - 3-5</a></p><br><p class="smaller_text">This lesson focuses on opportunity cost (economics) and graphs (mathematics). The students review terms related to measuring time and convert a time schedule into a pie chart, or circle graph. The students use the circle graph to assist them in ma...</p><br><p>--------------------------------------------------------------------</p><p><a href="event:function=viewLesson,67894"><b>Lesson 7 - Let's Make Choices</b></a><br><a href="event:function=viewPublication,114">Focus: Economics - Grades K-2</a></p><br><p class="smaller_text">The students explore choices made as consumers and as producers. They evaluate alternative treats, reviewing the costs and benefits of each. As each
student makes his or her choice, both the choice and the opportunity cost are identified.</p><br><p>--------------------------------------------------------------------</p><p><a href="event:function=viewLesson,62315"><b>Lesson 3: Wooden Opportunities</b></a><br><a href="event:function=viewPublication,58">Master Curriculum Guides in Economics: Teaching Strategies - 3-4</a></p><br><p class="smaller_text">Opportunity cost is the highest valued alternative given up when another option is chosen. Because people can't have everything they want, there is always an opportunity cost when they choose to buy a good or service. The same is true for produc...</p><br><p>--------------------------------------------------------------------</p><p><a href="event:function=viewLesson,20980"><b>Unit 3: Lesson 14 - Learning Center: Choice Train</b></a><br><a href="event:function=viewPublication,16">Master Curriculum Guides in Economics: Teaching Strategies - K-2</a></p><br><p class="smaller_text">Students practice making choices and identifying their opportunity costs as they fill their wants from the Choice Train cars.</p><br> <p>--------------------------------------------------------------------</p><p><a href="event:function=viewLesson,738"><b><font color="#CC6666">Online Lesson:</font> Everyday Opportunities</b></a><br><a href='http://www.econedlink.org/' target='_blank'>EconEdLink.org</a></p><br><p class="smaller_text">In this lesson, students will learn about choices and opportunity costs that occur every day. While this lesson will go on throughout the day, the actual lesson is short.</p><br><p>--------------------------------------------------------------------</p><p><a href="event:function=viewLesson,396"><b><font color="#CC6666">Online Lesson:</font> You Decide!</b></a><br><a href='http://www.econedlink.org/' target='_blank'>EconEdLink.org</a></p><br><p class="smaller_text">Think about a difficult decision you have had to make. After you decided did it work out? Why or why not? Why do you think decisions and choices are hard to make? We make personal decisions and we make decisions as groups. There is a tool you...</p><br><p>--------------------------------------------------------------------</p><p><a href="event:function=viewLesson,365"><b><font color="#CC6666">Online Lesson:</font> Jelly Belly Jam</b></a><br><a href='http://www.econedlink.org/' target='_blank'>EconEdLink.org</a></p><br><p class="smaller_text">In this lesson students will make a decision making chart and use it to help them in deciding which flavor of Jelly beans to buy.</p><br><p>--------------------------------------------------------------------</p><p><a href="event:function=viewLesson,267"><b><font color="#CC6666">Online Lesson:</font> Vincent van Gogh's 'Flower Beds in Holland'</b></a><br><a href='http://www.econedlink.org/' target='_blank'>EconEdLink.org</a></p><br><p class="smaller_text">Students study a painting by van Gogh called, "Flower Beds in Holland." The students recognize that this farmer made a choice to grow flowers instead of another crop. Students are introduced to the concepts of choice and opportunity...</p><br><p>--------------------------------------------------------------------</p><p><a href="event:function=viewLesson,178"><b><font color="#CC6666">Online Lesson:</font> Off to Interactive Island</b></a><br><a href='http://www.econedlink.org/' target='_blank'>EconEdLink.org</a></p><br><p class="smaller_text">This activity provides a fun way to explore concept of economic decision making. In the lesson, students are given a limited number of “tokens” and asked to exchange those tokens for goods in preparation for pioneering in a new land....</p><br>]]></lessons>
<tips><![CDATA[<p class="tipHeading">Tip #1</p><p>Opportunity cost is often taught incorrectly. Here is an example of the most frequent error. The students are told to list 10 items that they want, each with a price of $10. They are then told to select the one thing they would buy if they had $10. Finally, they are told that the other nine items on their list are their opportunity cost. This is wrong. The students were never able to have all 10 items--only one. Their opportunity cost is the highest-valued alternative they would have bought--their second choice. Opportunity cost is opportunity lost.</p><br><p class="tipHeading">Tip #2</p><p>Students often have a hard time initially grasping that the opportunity cost of any decision they make is not <i>all</i> the forgone opportunities, but only the next most valuable one or their second choice. Here are some ways to illustrate this idea. Have the students draw on three index cards or scraps of paper the three things they would like to do most after school today. Ask them what they want to do most, second most and third most. Then ask them the opportunity cost of what they want to do most. It should be the card of the activity they want to do second most, not both other cards. You could also do this activity with small items such as a candy bar, pencil and pen.</p><br><p class="tipHeading">Tip #3</p><p>When introducing opportunity cost to young children, it is best to use examples that do not involve money. For example, offer the students a choice among three small toys. When they choose one, their opportunity cost is one of the two other toys. In this fashion, the students begin to understand that opportunity cost isn't associated only with dollar cost.</p><br><p class="tipHeading">Tip #4</p><p>One of the most famous clichés in economics is that "there is no such thing as a free lunch." The reason there is no such thing as a free lunch is that everything we have has an opportunity cost.</p><br>]]></tips>
<resources><![CDATA[<p><b>Interactive tools:</b><br /></p><p><font color="#CC6666">Video</font> <a href='http://www.econedlink.org/i190' target='_blank'>Opportunity Cost</a></p><p>This video teaches the concept of Opportunity Cost. Opportunity cost is what you must give up to obtain something else, the second-best alternative. However, what you must give up to obtain your first choice is not really money--it is whatever oth...<br><font size="-10"><br /></font><font size="-3">Date Published: 07/12/2012<br>Grades: 3-5, 6-8, 9-12<br />Source: <a href='http://www.econedlink.org/' target='_blank'>EconEdLink.org</a></font></p><br><p><font color="#CC6666">Video</font> <a href='http://www.econedlink.org/i269' target='_blank'>Making Sen$e with Paul Solman: Future Unclear for Superstorm Sandy Victims Dealing with Insurance Woes</a></p><p>Despite a history of hurricanes, there were many storm victims in New York without flood insurance thinking the risk for damage was low. But after Sandy hit, many residents are faced now with huge damage bills and no idea how they'll recover. Econ...<br><font size="-10"><br /></font><font size="-3">Date Published: 11/19/2012<br>Grades: 9-12<br />Source: <a href='http://www.econedlink.org/' target='_blank'>EconEdLink.org</a></font></p><br><p><font color="#CC6666">Video</font> <a href='http://www.econedlink.org/i265' target='_blank'>Never Too Young: Personal Finance for Young Learners</a></p><p>This program was developed in response to a growing interest in teaching students about personal finance through settings outside of the traditional school day. The program teaches young students about financial choices, cost‐benefit analysis fo...<br><font size="-10"><br /></font><font size="-3">Date Published: 10/19/2012<br>Grades: K-2, 3-5<br />Source: <a href='http://www.econedlink.org/' target='_blank'>EconEdLink.org</a></font></p><br><p><font color="#CC6666">Video</font> <a href='http://www.econedlink.org/i184' target='_blank'>Decision Making/Cost-Benefit Analysis</a></p><p>This video teaches the concepts of Decision Making and Cost-Benefit Analysis. Decision making refers to the process by which rational consumers seeking their own happiness or utility will make choices. Cost-benefit analysis is a technique for deci...<br><font size="-10"><br /></font><font size="-3">Date Published: 07/12/2012<br>Grades: 3-5, 6-8, 9-12<br />Source: <a href='http://www.econedlink.org/' target='_blank'>EconEdLink.org</a></font></p><br><p><font color="#CC6666">Video</font> <a href='http://www.econedlink.org/i191' target='_blank'>Productive Resources</a></p><p>This video teaches the concept of Productive Resources. Productive resources are used to produce goods and services and are classified into four categories: land, labor, capital, and entrepreneurship.<br><font size="-10"><br /></font><font size="-3">Date Published: 07/12/2012<br>Grades: 3-5, 6-8, 9-12<br />Source: <a href='http://www.econedlink.org/' target='_blank'>EconEdLink.org</a></font></p><br><p>-------------------------------------</p><p><b>Lessons:</b></p><br><p><a href='http://www.econedlink.org/e1103' target='_blank'>The 411 on College Education</a></p><p>One of the most important financial decisions people make is whether to go to college. The price tag of a college education is rising, but so are the benefits. In this lesson, students will begin by learning the relationship between level of education and the average unemployment rate; and level of education and median weekly income. Students then learn about wage premiums and investigate the various college options available to them; financing options available to them; the importance of filling out the Free Application for Federal Student Aid (FAFSA); and finally, college as an investment in human capital, examine the costs and benefits, and decide whether it is a good choice.<br><font size="-10"><br /></font><font size="-3">Date Published: 01/25/2013<br />Grades: 9-12<br />Source: <a href='http://www.econedlink.org/' target='_blank'>EconEdLink.org</a></font></p><br><p><a href='http://www.econedlink.org/e1057' target='_blank'>Opportunity Cost</a></p><p>Consumers are faced with tough choices because so many innovative and exciting products and services are available. Therefore, engraining a decision-making process that includes considering of opportunity cost is necessary to shape future consumer behavior.<br><font size="-10"><br /></font><font size="-3">Date Published: 01/03/2012<br />Grades: 9-12<br />Source: <a href='http://www.econedlink.org/' target='_blank'>EconEdLink.org</a></font></p><br><p><a href='http://www.econedlink.org/e966' target='_blank'>Green Eggs and ...Economics?</a></p><p>Economic concepts are often found in places students have never considered, like children’s literature. In this lesson, students will explore the various economic concepts addressed in five of Dr. Seuss' most popular books: The Cat in the Hat; Green Eggs and Ham; The Lorax; Oh, the Places You’ll Go! and Horton Hears a Who! This lesson assumes the students already have some knowledge of basic microeconomic concepts. Therefore, it would be best utilized as a review or unit summary to reinforce the concepts you have already covered.<br><font size="-10"><br /></font><font size="-3">Date Published: 01/19/2012<br />Grades: 9-12<br />Source: <a href='http://www.econedlink.org/' target='_blank'>EconEdLink.org</a></font></p><br><p><a href='http://www.econedlink.org/e963' target='_blank'>Specialization and the Decathlon</a></p><p>This lesson uses results from the 2008 Summer Olympic Games to explain that athletes specialize in sports and events for which they are most skilled for the same reasons that individuals and nations specialize in the production of goods and services for which they have an absolute or a comparative advantage.<br><font size="-10"><br /></font><font size="-3">Date Published: 08/09/2011<br />Grades: 9-12<br />Source: <a href='http://www.econedlink.org/' target='_blank'>EconEdLink.org</a></font></p><br><p><a href='http://www.econedlink.org/e911' target='_blank'>Trouble is Brewing in Boston - "Colonial Voices: Hear Them Speak"</a></p><p>It’s December 16, 1773 and many of the citizens of Boston are furious with King George’s new tax on tea. Young Ethan, a printer’s errand boy, has been given the task of conveying information concerning an upcoming protest meeting. As he makes his rounds through the city the reader is introduced to the goods and services provided by colonial merchants.
[NOTE: These lessons are based on the book "Colonial Voices Hear Them Speak" by Kay Winters. However, it is not necessary for the students to have read the book to successfully complete the activities.]<br><font size="-10"><br /></font><font size="-3">Date Published: 01/27/2011<br />Grades: K-2, 3-5<br />Source: <a href='http://www.econedlink.org/' target='_blank'>EconEdLink.org</a></font></p><br>]]></resources>
<related>
<concept>1</concept>
<concept>54</concept>
<concept>57</concept>
</related>
<quiz>1</quiz>
</concept>
<concept>
<id>34</id>
<name>Price Ceilings and Floors</name>
<category>2</category>
<definition><![CDATA[<p>A <b><a href="event:function=defineGlossaryTerm,Price Ceiling">price ceiling</a></b> is a legally established maximum <a href="event:function=defineGlossaryTerm,Price">price</a>. Governments enact price ceilings when they fear that the price might be higher than they desire it to be. Examples of a price ceiling are rent-control laws that limit the rent that can be charged (or limit the increase in rents from year to year). When a price ceiling is lower than the market price that would otherwise prevail, the result is that <a href="event:function=defineGlossaryTerm,Quantity Demanded">quantity demanded</a> in the market (which is encouraged by the lower price) exceeds <a href="event:function=defineGlossaryTerm,Quantity Supplied">quantity supplied</a> (which is discouraged by the lower price). Economists call this outcome a <a href="event:function=defineGlossaryTerm,Shortage">shortage</a>. </p><br><p>One unintended <a href="event:function=defineGlossaryTerm,Consequence">consequence</a> of a price ceiling is that although the price ceiling is meant to make the <a href="event:function=defineGlossaryTerm,Goods">good</a> more affordable and benefit <a href="event:function=defineGlossaryTerm,Consumers">consumers</a>, it instead creates a situation in which some of those who <a href="event:function=defineGlossaryTerm,Demand">demand</a> the good won't be able to buy it at all. A second implication is that price ceilings open up <a href="event:function=defineGlossaryTerm,Incentive">incentives</a> for an illegal market, which refers to <a href="event:function=defineGlossaryTerm,Sale">sales</a> which happen at an illegal price. </p> <br><p>A <b><a href="event:function=defineGlossaryTerm,Price Floor">price floor</a></b> is a legally established minimum price. Governments enact price floors when they fear that the price might be lower than they desire it to be. Examples of price floors include farm <a href="event:function=defineGlossaryTerm,Product">products</a> and the minimum <a href="event:function=defineGlossaryTerm,Wage">wage</a>. When a price floor is higher than the market price that would otherwise prevail, the result is that quantity supplied in the market (which is encouraged by the higher price) exceeds quantity demanded (which is discouraged by the higher price). Economists call this outcome a <a href="event:function=defineGlossaryTerm,Surplus">surplus</a>. </p> <br><p>One unintended consequence of a price floor is that although the price floor is meant to benefit providers of the good or <a href="event:function=defineGlossaryTerm,Services">service</a>, it creates a situation in which some of those providers won't be able to sell their goods or services. This is because at the price floor, an insufficient quantity is demanded. With farm price supports, the government has often stepped in to purchase the surplus products. With minimum wage laws, a basic concern is that although the minimum wage will help those who continue to keep their <a href="event:function=defineGlossaryTerm,Job">job</a>, it will injure those who lose a job (or are not hired or are hired for fewer hours) as a result of the minimum wage.</p>]]></definition>
<lessons><![CDATA[<p>Below are <b>featured</b> lessons for teaching Price Ceilings and Floors.</p><br><p class="tipHeading">High School Lessons</p><p>--------------------------------------------------------------------</p><p><a href="event:function=viewLesson,67855"><b>Lesson 7 - Should We Allow a Market For Transplant Organs?</b></a><br><a href="event:function=viewPublication,113">Teaching the Ethical Foundations of Economics</a></p><br><p class="smaller_text">The students learn that there is a shortage of transplant organs in the United States. They explore ways to reduce the shortage, particularly by increasing the supply. First the students use supply and demand to analyze a market for kidneys. Then ...</p><br><p>--------------------------------------------------------------------</p><p><a href="event:function=viewLesson,60251"><b>Lesson 1: Markets and the Market System</b></a><br><a href="event:function=viewPublication,39">Focus: Institutions and Markets</a></p><br><p class="smaller_text">This lesson introduces students to the primary economic institution in a market economy, markets. As described in the introductory essay to this volume, markets are an institution that emerges spontaneously from the interaction of self-interested...</p><br><p>--------------------------------------------------------------------</p><p><a href="event:function=viewLesson,17808"><b>Unit 2: Lesson 14 - Secondary Effects: Price Ceilings and Floors</b></a><br><a href="event:function=viewPublication,1">Capstone: Exemplary Lessons for High School Economics - Teacher's Guide</a></p><br><p class="smaller_text">Students investigate the consequences of price controls in markets for silver, rock concerts, automobiles, razor clams, and school textbooks. (It would be best to use this lesson after students have participated in the silver market game [Unit 2, ...</p><br><p>--------------------------------------------------------------------</p><p><a href="event:function=viewLesson,508"><b><font color="#CC6666">Online Lesson:</font> Marketplace: Price Increase or Price-Gouging?</b></a><br><a href='http://www.econedlink.org/' target='_blank'>EconEdLink.org</a></p><br><p class="smaller_text">Students learn about price-gouging. Using a hypothetical post-disaster example, they will learn more about supply and demand, as well as the complexities associated with price increases in a supply-constrained market.</p><br><p>--------------------------------------------------------------------</p><p><a href="event:function=viewLesson,8"><b><font color="#CC6666">Online Lesson:</font> Babysitter Shortage in Washington, D.C.</b></a><br><a href='http://www.econedlink.org/' target='_blank'>EconEdLink.org</a></p><br><p class="smaller_text">What is responsible for the shortage of babysitters in Washington, DC? Identify the parts of the article which indicate a decrease in supply and an increase in demand.</p><br><p class="tipHeading">Elementary Lessons</p><p>--------------------------------------------------------------------</p><p><a href="event:function=viewLesson,62357"><b>Lesson 12: Market Madness</b></a><br><a href="event:function=viewPublication,59">Master Curriculum Guides in Economics: Teaching Strategies - 5-6</a></p><br><p class="smaller_text">The market (price) system answers the basic economic questions of what, how and for whom to produce in the marketplace. The demand decisions of consumers and the supply decisions of producers interact to establish prices and quantities exchanged....</p><br><p>--------------------------------------------------------------------</p><p><a href="event:function=viewLesson,62356"><b>Lesson 11: Market Balance</b></a><br><a href="event:function=viewPublication,59">Master Curriculum Guides in Economics: Teaching Strategies - 5-6</a></p><br><p class="smaller_text">The market (price) system answers the basic economic questions of what, how, and for whom to produce in the marketplace. The demand decisions of consumers and the supply decisions of producers interact to establish prices and quantities exchanged...</p><br><p>--------------------------------------------------------------------</p><p><a href="event:function=viewLesson,62323"><b>Lesson 11: Those Golden Jeans</b></a><br><a href="event:function=viewPublication,58">Master Curriculum Guides in Economics: Teaching Strategies - 3-4</a></p><br><p class="smaller_text">Supply and demand are concepts that students can easily understand when the concepts are demonstrated with products familiar to them. The Law of Demand states that consumers are willing and able to buy less of a product at higher prices and more ...</p><br> <p>--------------------------------------------------------------------</p><p><a href="event:function=viewLesson,557"><b><font color="#CC6666">Online Lesson:</font> Those Golden Jeans</b></a><br><a href='http://www.econedlink.org/' target='_blank'>EconEdLink.org</a></p><br><p class="smaller_text">This lesson is designed to review the three types of productive resources-natural resources, human resources, and capital resources-needed to produce goods and services. Students use the internet to identify examples of each - first in the pr...</p><br><p>--------------------------------------------------------------------</p><p><a href="event:function=viewLesson,209"><b><font color="#CC6666">Online Lesson:</font> If I Ran the Zoo - Economics and Literature</b></a><br><a href='http://www.econedlink.org/' target='_blank'>EconEdLink.org</a></p><br><p class="smaller_text">Welcome to the Zoo! In this two-day lesson you will use Dr. Seuss' If I Ran The Zoo book to introduce the economic concepts to your students. You will also get the chance to use actual zoo criteria to help a zoo "choose" new animals.</p><br>]]></lessons>
<tips><![CDATA[<p class="tipHeading">Tip #1</p><p>It is sometimes confusing to students when looking at graphical depictions of price floors and ceilings because visually it appears that ceilings are below floors (although both types of price controls would not likely appear within the same market). Think about a tiny person, Tiny Tim, being "inside" the graph. If Tiny Tim starts to jump up and down, he will bump his head on the ceiling and not be able to rise any farther, much as a price ceiling prevents prices from rising above it. Similarly, Tiny Tim is unable to crash through the floor, much as a price floor prevents prices from falling below it.</p><br><p class="tipHeading">Tip #2</p><p>Students need to distinguish the differences between the short-term and long-term effects of price ceilings and floors. For example, rent controls will create a greater shortage of housing in the long run than in the short run because it will not be profitable to build more apartments. Price floors in agriculture in developed nations like the United States, France and Germany generate surpluses which eventually destroy agricultural markets in poor nations, increasing unemployment among farmers in the countryside and increasing urban squalor as unemployed farmers move to the city.</p><br><p class="tipHeading">Tip #3</p><p>In your presentation of price ceilings and floors, discuss how changing prices are incentives that determine what to produce, how to produce and for whom to produce. Sometimes the students are mechanistic and merely identify shortages and surpluses on a graph. They should instead understand why price ceilings cause shortages and price floors cause surpluses. People react to incentives in predictable ways.</p><br>]]></tips>
<resources><![CDATA[<p><b>Interactive tools:</b><br /></p><p><font color="#CC6666">Video</font> <a href='http://www.econedlink.org/i210' target='_blank'>Demand</a></p><p>This video teaches the concept of Demand. Demand refers to a relationship between price and the quantity of a good or service that consumers demand.<br><font size="-10"><br /></font><font size="-3">Date Published: 07/12/2012<br>Grades: 3-5, 6-8, 9-12<br />Source: <a href='http://www.econedlink.org/' target='_blank'>EconEdLink.org</a></font></p><br><p><font color="#CC6666">Video</font> <a href='http://www.econedlink.org/i216' target='_blank'>Markets and Prices</a></p><p>This video teaches the concept of Markets and Prices. A market refers to a group of buyers and sellers for a given good or service. The price is the amount of money needed to buy a particular good or service.<br><font size="-10"><br /></font><font size="-3">Date Published: 07/12/2012<br>Grades: 6-8, 9-12<br />Source: <a href='http://www.econedlink.org/' target='_blank'>EconEdLink.org</a></font></p><br><p><font color="#CC6666">Video</font> <a href='http://www.econedlink.org/i217' target='_blank'>Price Ceilings and Floors</a></p><p>This video teaches the concept of Price Ceilings and Floors. A price ceiling is a legally established maximum price while a price floor is a legally established minimum price.<br><font size="-10"><br /></font><font size="-3">Date Published: 07/12/2012<br>Grades: 9-12<br />Source: <a href='http://www.econedlink.org/' target='_blank'>EconEdLink.org</a></font></p><br><p><font color="#CC6666">Video</font> <a href='http://www.econedlink.org/i221' target='_blank'>Supply</a></p><p>This video teaches the concept of Supply. Supply refers to a relationship between price and the quantity of a good or service that firms are willing to produce.<br><font size="-10"><br /></font><font size="-3">Date Published: 07/12/2012<br>Grades: 3-5, 6-8, 9-12<br />Source: <a href='http://www.econedlink.org/' target='_blank'>EconEdLink.org</a></font></p><br><p>-------------------------------------</p><p><b>Lessons:</b></p><br><p><a href='http://www.econedlink.org/e961' target='_blank'>Supply and Demand, Lessons From Toy Fads.</a></p><p>The concepts of supply and demand and related terms are taught through stories about the toy fads of Hula Hoops and Silly Bandz. In 1958, Wham-O, Inc. began marketing the Hula Hoop in the United States and sales of the Hula Hoops sky-rocketed as over 25 million were sold in the first few months, within the year over 100 million. Similarly today, Silly Bandz has taken off in sales since the summer of 2008.<br><font size="-10"><br /></font><font size="-3">Date Published: 05/17/2011<br />Grades: 6-8<br />Source: <a href='http://www.econedlink.org/' target='_blank'>EconEdLink.org</a></font></p><br><p><a href='http://www.econedlink.org/e853' target='_blank'>The Ice Cream Stand</a></p><p>Students will learn about supply, demand, price, competition, and entrepreneurial skills in this lesson. They will put what they learned into action by creating an ice cream stand, to complete with other stands in the classroom.<br><font size="-10"><br /></font><font size="-3">Date Published: 12/02/2009<br />Grades: 6-8<br />Source: <a href='http://www.econedlink.org/' target='_blank'>EconEdLink.org</a></font></p><br><p><a href='http://www.econedlink.org/e557' target='_blank'>Those Golden Jeans</a></p><p>This lesson is designed to review the three types of productive resources-natural resources, human resources, and capital resources-needed to produce goods and services. Students use the internet to identify examples of each - first in the production of pizza, then the mining of gold during the California gold rush.<br><font size="-10"><br /></font><font size="-3">Date Published: 04/19/2004<br />Grades: 3-5<br />Source: <a href='http://www.econedlink.org/' target='_blank'>EconEdLink.org</a></font></p><br><p><a href='http://www.econedlink.org/e508' target='_blank'>Marketplace: Price Increase or Price-Gouging?</a></p><p>Students learn about price-gouging. Using a hypothetical post-disaster example, they will learn more about supply and demand, as well as the complexities associated with price increases in a supply-constrained market.<br><font size="-10"><br /></font><font size="-3">Date Published: 06/23/2008<br />Grades: 9-12<br />Source: <a href='http://www.econedlink.org/' target='_blank'>EconEdLink.org</a></font></p><br><p><a href='http://www.econedlink.org/e328' target='_blank'>Economic Spotter: Supply and Demand at the Gold Rush</a></p><p>During the Gold Rush, people paid exorbitant prices for ordinary objects. Why? Because of the laws of supply and demand, that's why! In the lesson, students will see how these laws fit into this great historical time.<br><font size="-10"><br /></font><font size="-3">Date Published: 07/23/2002<br />Grades: 3-5, 6-8<br />Source: <a href='http://www.econedlink.org/' target='_blank'>EconEdLink.org</a></font></p><br>]]></resources>
<related>
<concept>23</concept>
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<concept>22</concept>
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<quiz>1</quiz>
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<concept>
<id>67</id>
<name>Producers</name>
<category>2</category>
<definition><![CDATA[<p><a href="event:function=defineGlossaryTerm,Producers"><b>Producers</b></a> use scarce <a href="event:function=defineGlossaryTerm,Resources">resources</a> to produce <a href="event:function=defineGlossaryTerm,Goods">goods</a> and <a href="event:function=defineGlossaryTerm,Services">services</a> which they offer to sell to <a href="event:function=defineGlossaryTerm,Consumers">consumers</a>. Because <a href="event:function=defineGlossaryTerm,Productive Resources">productive resources</a> are scarce, producers must weigh their <a href="event:function=defineGlossaryTerm,Opportunity Cost">opportunity cost</a> when making their <a href="event:function=defineGlossaryTerm,Production">production</a> decisions. The concepts of producers and production are often introduced in the elementary grades to prepare students for a better understanding of <a href="event:function=defineGlossaryTerm,Supply">supply</a>. A supply schedule describes the behavior of producers and illustrates the quantities of a good or service that will be offered for <a href="event:function=defineGlossaryTerm,Sale">sale</a> at various <a href="event:function=defineGlossaryTerm,Price">prices</a> during a specific time period. Generally, the higher the price of something, the more of it will be offered for sale and vice versa.</p> <br><p>Producers attempt to maximize <a href="event:function=defineGlossaryTerm,Profit">profits</a> by selling what consumers <a href="event:function=defineGlossaryTerm,Demand">demand</a> and by producing as efficiently as possible. Producer behavior also is influenced by the amount of <a href="event:function=defineGlossaryTerm,Competition">competition</a> in the particular market.</p>]]></definition>
<lessons><![CDATA[<p>Below are <b>featured</b> lessons for teaching Producers.</p><br><p class="tipHeading">High School Lessons</p><p>--------------------------------------------------------------------</p><p><a href="event:function=viewLesson,68058"><b>Lesson 2 - The Candy Kids - Supply and Demand for Candy</b></a><br><a href="event:function=viewPublication,133">Economics from Here to There </a></p><br><p class="smaller_text">The students participate in and discuss two games aimed at giving them an understanding that consumers and producers respond to incentives and behave according to the law of demand (as illustrated by the first game) and the law of supply (as illus...</p><br><p>--------------------------------------------------------------------</p><p><a href="event:function=viewLesson,68074"><b>Opportunity Cost: There's No Such Thing as a Free Lunch!</b></a><br><a href="event:function=viewPublication,117">What Economics Is About: Understanding the Basics of Our Economic System</a></p><br><p class="smaller_text">Because of scarcity, any time a choice is made, there are alternatives that are not chosen. More precisely, there is always one next best alternative that is not chosen. In economics, the value of the next best alternative is called opportunity cost.</p><br><p>--------------------------------------------------------------------</p><p><a href="event:function=viewLesson,56529"><b>Section 1: Income and Choices</b></a><br><a href="event:function=viewPublication,18">Your Credit Counts Challenge: Trainer's Guide</a></p><br><p class="smaller_text">Participants will understand the importance of spending less than they receive. Participants will understand how competition based on productivity determines the wages and salaries that people receive. Participants will analyze a list of expendi...</p><br> <p>--------------------------------------------------------------------</p><p><a href="event:function=viewLesson,536"><b><font color="#CC6666">Online Lesson:</font> Dry as a Bone</b></a><br><a href='http://www.econedlink.org/' target='_blank'>EconEdLink.org</a></p><br><p class="smaller_text">This lesson examines the current state of drought in the United States and the economic impact of drought on local communities.</p><br><p>--------------------------------------------------------------------</p><p><a href="event:function=viewLesson,46"><b><font color="#CC6666">Online Lesson:</font> I'll Trade You a Bag of Chips, Two Cookies, and $60,000 for Your Tuna Fish Sandwich</b></a><br><a href='http://www.econedlink.org/' target='_blank'>EconEdLink.org</a></p><br><p class="smaller_text">Okay, so your tuna fish sandwich probably isn't worth a couple grand. It's most likely made with a type of tuna called albacore. But, on the docks in Tokyo different kind of tuna, related to the stuff in your sandwich, is sold for $70,000 dol...</p><br><p class="tipHeading">Middle School Lessons</p><p>--------------------------------------------------------------------</p><p><a href="event:function=viewLesson,67881"><b>Lesson 12 - Neighborhood Producers and Consumers</b></a><br><a href="event:function=viewPublication,115">Focus: Economics - Grades 3-5</a></p><br><p class="smaller_text">In this lesson, students examine the story of "The Little Red Hen" to determine the types of activities that make someone a producer or a consumer. Students extend their knowledge of producers and consumers by identifying occasions on which membe...</p><br> <p>--------------------------------------------------------------------</p><p><a href="event:function=viewLesson,403"><b><font color="#CC6666">Online Lesson:</font> Bringing the Market to the Farm</b></a><br><a href='http://www.econedlink.org/' target='_blank'>EconEdLink.org</a></p><br><p class="smaller_text">Students learn how community supported agriculture (CSAs) is changing the relationship between the farmer and the consumer.</p><br><p>--------------------------------------------------------------------</p><p><a href="event:function=viewLesson,313"><b><font color="#CC6666">Online Lesson:</font> From Butterflies to Buffaloes</b></a><br><a href='http://www.econedlink.org/' target='_blank'>EconEdLink.org</a></p><br><p class="smaller_text">Nature tourism, also known as ecotourism, is a fast growing segment of the tourism industry. In this lesson, students learn what ecotourism is and explore how conservation of our natural resources can be profitable.</p><br><p>--------------------------------------------------------------------</p><p><a href="event:function=viewLesson,276"><b><font color="#CC6666">Online Lesson:</font> NOT your Grandma's Lemonade Stand</b></a><br><a href='http://www.econedlink.org/' target='_blank'>EconEdLink.org</a></p><br><p class="smaller_text">After a review of elementary economic concepts, students will apply their understanding by playing an online computer game, Lemonade Stand. This game has the students competing against themselves and others to earn the biggest profit in 25 da...</p><br><p>--------------------------------------------------------------------</p><p><a href="event:function=viewLesson,62"><b><font color="#CC6666">Online Lesson:</font> US History: Inventors & Entrepreneurs</b></a><br><a href='http://www.econedlink.org/' target='_blank'>EconEdLink.org</a></p><br><p class="smaller_text">Students will learn the difference between inventors and entrepreneurs. From talking with adults they will learn some of the benefits inventors and entrepreneurs have provided for society in the last 40 years.</p><br><p class="tipHeading">Elementary Lessons</p><p>--------------------------------------------------------------------</p><p><a href="event:function=viewLesson,67930"><b>Lesson 9: Ant Cities</b></a><br><a href="event:function=viewPublication,116">Teaching Economics Using Children's Literature</a></p><br><p class="smaller_text">This is a nonfiction story about different kinds of ants and how they live and work together. Ants live in colonies, and all ants have particular jobs to do, much like workers in our cities. Working together, ants keep their "cities" growing and...</p><br><p>--------------------------------------------------------------------</p><p><a href="event:function=viewLesson,62629"><b>Lesson 5: Dacian Masks</b></a><br><a href="event:function=viewPublication,76">Resources A to Z</a></p><br><p class="smaller_text">After learning about the Dacians who lived about 2000 years ago in the area now known as Romania, students make ancient Dacian masks. Students classify the different productive resources used to produce masks as natural resources, human resources...</p><br><p>--------------------------------------------------------------------</p><p><a href="event:function=viewLesson,62354"><b>Lesson 9: Producers and Supply</b></a><br><a href="event:function=viewPublication,59">Master Curriculum Guides in Economics: Teaching Strategies - 5-6</a></p><br><p class="smaller_text">Producers are the sellers (or suppliers) of output in a market. In the circular flow of economic activity, businesses are suppliers in the market for goods and services; individuals and households are the suppliers in the market for resources. S...</p><br><p>--------------------------------------------------------------------</p><p><a href="event:function=viewLesson,20991"><b>Unit 5: Lesson 25 - Bulletin Board: Teddy Bear Picnic</b></a><br><a href="event:function=viewPublication,16">Master Curriculum Guides in Economics: Teaching Strategies - K-2</a></p><br><p class="smaller_text">Students prepare for and participate in a picnic with their teddy bears as they learn about markets and prices.</p><br><p>--------------------------------------------------------------------</p><p><a href="event:function=viewLesson,20975"><b>Unit 2: Lesson 9 - Learning Center: Producer Pigs</b></a><br><a href="event:function=viewPublication,16">Master Curriculum Guides in Economics: Teaching Strategies - K-2</a></p><br><p class="smaller_text">Students hear a version of The Three Little Pigs and participate in a learning center which reinforces the concepts of natural, human, and capital resources.</p><br><p>--------------------------------------------------------------------</p><p><a href="event:function=viewLesson,20974"><b>Unit 2: Lesson 8 - Producer Charades</b></a><br><a href="event:function=viewPublication,16">Master Curriculum Guides in Economics: Teaching Strategies - K-2</a></p><br><p class="smaller_text">Students create charades representing services performed in their classroom and later apply for and "hired" to produce these services.</p><br> <p>--------------------------------------------------------------------</p><p><a href="event:function=viewLesson,745"><b><font color="#CC6666">Online Lesson:</font> How Labor Got Its Day</b></a><br><a href='http://www.econedlink.org/' target='_blank'>EconEdLink.org</a></p><br><p class="smaller_text">If you asked students what comes to mind first when they think of Labor Day, what do you think they would say? The last days of summer? A family picnic? Shopping the Labor Day sales? The purpose of this lesson is to broaden and deepen student unde...</p><br><p>--------------------------------------------------------------------</p><p><a href="event:function=viewLesson,564"><b><font color="#CC6666">Online Lesson:</font> Little Bill the Producer!</b></a><br><a href='http://www.econedlink.org/' target='_blank'>EconEdLink.org</a></p><br><p class="smaller_text">This lesson teaches the most basic vocabulary about production. People who make goods and provide services are called producers. This lesson only deals with the student making something (not identified with being a good), and that people are ...</p><br><p>--------------------------------------------------------------------</p><p><a href="event:function=viewLesson,457"><b><font color="#CC6666">Online Lesson:</font> We are Consumers and Producers</b></a><br><a href='http://www.econedlink.org/' target='_blank'>EconEdLink.org</a></p><br><p class="smaller_text">Students are consumers and producers. So are their families. In this lesson students learn how they and family members fulfill these roles at home and in their community. They begin by exploring the goods and services that people use and they...</p><br><p>--------------------------------------------------------------------</p><p><a href="event:function=viewLesson,540"><b><font color="#CC6666">Online Lesson:</font> Mystery Workers</b></a><br><a href='http://www.econedlink.org/' target='_blank'>EconEdLink.org</a></p><br><p class="smaller_text">In this lesson students review the concepts of goods, services, and producers using the Internet to locate examples of each in a teacher's classroom. They learn about the three kinds of resources necessary to produce goods and provide service...</p><br><p>--------------------------------------------------------------------</p><p><a href="event:function=viewLesson,464"><b><font color="#CC6666">Online Lesson:</font> Simple Simon Meets a Producer</b></a><br><a href='http://www.econedlink.org/' target='_blank'>EconEdLink.org</a></p><br><p class="smaller_text">A classic rhyme, Simple Simon and the Pie-Man, introduces students to the concepts of consumer and producer. Students learn that consumers are the people who buy and use goods and services. Producers make the goods and provide the services. When p...</p><br>]]></lessons>
<tips><![CDATA[<p class="tipHeading">Tip #1</p><p>Younger students identify with consuming goods and services but not with producing them. Brainstorm with the students about the kinds of jobs that people do and what goods and services they produce.</p><br><p class="tipHeading">Tip #2</p><p>Assign younger students jobs in your classroom and show them they are producing a good or a service. Some jobs could be chalkboard eraser, paper passer, classroom librarian, classroom gardener, song leader, pledge leader and playground equipment manager. If possible, pay the students for their work with tokens that may be used later to purchase small items from you. You may also want to check out The Classroom Mini-Economy publication from the Council for Economic Education.</p><br><p class="tipHeading">Tip #3</p><p>Discuss with the students their roles as consumers and producers. Consumers are also producers or they could not earn income to buy what is produced. Consumers and producers are interdependent. Consumers who complain about products of poor quality could be responsible for producing those products.</p><br>]]></tips>
<resources><![CDATA[<p><b>Interactive tools:</b><br /></p><p><font color="#CC6666">Video</font> <a href='http://www.econedlink.org/i261' target='_blank'>Making Sen$e with Paul Solman: With High Youth Unemployment, Making Sense of Summer Work Visas For Foreigners</a></p><p>Since the 1960s, the State Department has sponsored young foreigners for temporary, low-wage summer jobs in the U.S. But with high youth unemployment, some believe the program takes summer jobs away from American youth. So is the program's motivat...<br><font size="-10"><br /></font><font size="-3">Date Published: 08/17/2012<br>Source: <a href='http://www.econedlink.org/' target='_blank'>EconEdLink.org</a></font></p><br><p><font color="#CC6666">Video</font> <a href='http://www.econedlink.org/i275' target='_blank'>Making Sen$e with Paul Solman: Manufacturer Vita Needle Finds Investment in Older Workers Turns a Big Profit</a></p><p>The average age of Vita Needle's workers is 74 years old, and that's no accident. The manufacturing company has intentionally hired seniors -- a decision that has increased profits and benefited older workers who often have a harder time finding a...<br><font size="-10"><br /></font><font size="-3">Date Published: 01/02/2013<br>Grades: 9-12<br />Source: <a href='http://www.econedlink.org/' target='_blank'>EconEdLink.org</a></font></p><br><p><font color="#CC6666">Video</font> <a href='http://www.econedlink.org/i264' target='_blank'>Making Sen$e with Paul Solman: Is Applying for Jobs Online Not an Effective Way to Find Work?</a></p><p>With a bad economy and nearly everyone on the internet, one job opening promoted online can receive thousands of applications. So with competition fierce and many firms using software rather than human beings to hire, Paul Solman explores whether ...<br><font size="-10"><br /></font><font size="-3">Date Published: 09/25/2012<br>Grades: 9-12<br />Source: <a href='http://www.econedlink.org/' target='_blank'>EconEdLink.org</a></font></p><br><p><font color="#CC6666">Video</font> <a href='http://www.econedlink.org/i178' target='_blank'>Making Sen$e with Paul Solman: For Undocumented Workers, It's Not-so-Sweet Home Alabama</a></p><p>The controversial Alabama immigration law, know as HB 56, instructs employers to check a worker's immigration status with the government's E-Verify system. Paul Solman reports from Alabama on how one of the nation's toughest immigration laws affec...<br><font size="-10"><br /></font><font size="-3">Date Published: 10/28/2011<br>Grades: 9-12<br />Source: <a href='http://www.econedlink.org/' target='_blank'>EconEdLink.org</a></font></p><br><p><font color="#CC6666">Video</font> <a href='http://www.econedlink.org/i159' target='_blank'>Making Sen$e with Paul Solman: Returning Vets Face a New Battle: The Job Market</a></p><p>As part of his series on Making Sen$e of financial news, economics correspondent Paul Solman reports on the challenges veterans face returning home and searching for work in a troubled job market.<br><font size="-10"><br /></font><font size="-3">Date Published: 04/01/2011<br>Grades: 9-12<br />Source: <a href='http://www.econedlink.org/' target='_blank'>EconEdLink.org</a></font></p><br><p>-------------------------------------</p><p><b>Lessons:</b></p><br><p><a href='http://www.econedlink.org/e911' target='_blank'>Trouble is Brewing in Boston - "Colonial Voices: Hear Them Speak"</a></p><p>It’s December 16, 1773 and many of the citizens of Boston are furious with King George’s new tax on tea. Young Ethan, a printer’s errand boy, has been given the task of conveying information concerning an upcoming protest meeting. As he makes his rounds through the city the reader is introduced to the goods and services provided by colonial merchants.
[NOTE: These lessons are based on the book "Colonial Voices Hear Them Speak" by Kay Winters. However, it is not necessary for the students to have read the book to successfully complete the activities.]<br><font size="-10"><br /></font><font size="-3">Date Published: 01/27/2011<br />Grades: K-2, 3-5<br />Source: <a href='http://www.econedlink.org/' target='_blank'>EconEdLink.org</a></font></p><br><p><a href='http://www.econedlink.org/e745' target='_blank'>How Labor Got Its Day</a></p><p>If you asked students what comes to mind first when they think of Labor Day, what do you think they would say? The last days of summer? A family picnic? Shopping the Labor Day sales? The purpose of this lesson is to broaden and deepen student understanding of the Labor Day holiday. Students will learn why workers organized unions during the nineteenth century to fight for higher pay and better working conditions. They will discover that unions help balance the power between workers and employers—yielding a better life for many workers and their families today. This is a great lesson to do just before Labor Day. If your school doesn’t begin till after the holiday, consider doing it on May 1—the International Worker’s Rights Day!<br><font size="-10"><br /></font><font size="-3">Date Published: 02/04/2008<br />Grades: 3-5<br />Source: <a href='http://www.econedlink.org/' target='_blank'>EconEdLink.org</a></font></p><br><p><a href='http://www.econedlink.org/e564' target='_blank'>Little Bill the Producer!</a></p><p>This lesson teaches the most basic vocabulary about production. People who make goods and provide services are called producers. This lesson only deals with the student making something (not identified with being a good), and that people are human beings. In this story Little Bill and Alice the Great produce a book about Dr. Martin Luther King.<br><font size="-10"><br /></font><font size="-3">Date Published: 07/01/2004<br />Grades: K-2<br />Source: <a href='http://www.econedlink.org/' target='_blank'>EconEdLink.org</a></font></p><br><p><a href='http://www.econedlink.org/e540' target='_blank'>Mystery Workers</a></p><p>In this lesson students review the concepts of goods, services, and producers using the Internet to locate examples of each in a teacher's classroom. They learn about the three kinds of resources necessary to produce goods and provide services locating examples from a picture tour of the Crayola Factory. Through interviews they learn about the work of the people in their families and draw conclusions from their findings. Finally, they examine a picture of a farmer working in a field to identify examples of natural, human, and capital resources.<br><font size="-10"><br /></font><font size="-3">Date Published: 02/18/2004<br />Grades: K-2, 3-5<br />Source: <a href='http://www.econedlink.org/' target='_blank'>EconEdLink.org</a></font></p><br><p><a href='http://www.econedlink.org/e536' target='_blank'>Dry as a Bone</a></p><p>This lesson examines the current state of drought in the United States and the economic impact of drought on local communities.<br><font size="-10"><br /></font><font size="-3">Date Published: 05/17/2005<br />Grades: 9-12<br />Source: <a href='http://www.econedlink.org/' target='_blank'>EconEdLink.org</a></font></p><br>]]></resources>
<related>
<concept>22</concept>
<concept>25</concept>
<concept>69</concept>
<concept>70</concept>
</related>
<quiz>1</quiz>
</concept>
<concept>
<id>54</id>
<name>Productive Resources</name>
<category>0</category>
<definition><![CDATA[<p><b>Productive resources</b> are used to produce <a href="event:function=defineGlossaryTerm,Goods">goods</a> and <a href="event:function=defineGlossaryTerm,Services">services</a>. <a href="event:function=defineGlossaryTerm,Productive Resources">Productive resources</a> are classified into four categories. <a href="event:function=defineGlossaryTerm,Land">Land</a> stands for <a href="event:function=defineGlossaryTerm,Natural Resources">natural resources</a> or gifts of nature such as oil, iron ore, forests and water. <a href="event:function=defineGlossaryTerm,Labor">Labor</a> refers to <a href="event:function=defineGlossaryTerm,Human Resources">human resources</a>. Labor is more than the number of people willing and able to work. Labor also reflects the abilities of people and includes people's health, strength, education, motivation and skills. <a href="event:function=defineGlossaryTerm,Capital">Capital</a> refers to <a href="event:function=defineGlossaryTerm,Goods">goods</a> and <a href="event:function=defineGlossaryTerm,Services">services</a> such as buildings, equipment, roads, dams and machinery. The level of technology built into our capital is an important influence -- so important that some economists recognize technology as a separate productive resource. Finally, <a href="event:function=defineGlossaryTerm,Entrepreneurship">entrepreneurship</a> is a special kind of labor that represents the characteristics of people who assume the risk of organizing public resources to produce goods and services.</p>]]></definition>
<lessons><![CDATA[<p>Below are <b>featured</b> lessons for teaching Productive Resources.</p><br><p class="tipHeading">High School Lessons</p><p>--------------------------------------------------------------------</p><p><a href="event:function=viewLesson,67638"><b>Lesson 3 - Finding a Comparative Advantage, Including Your Own</b></a><br><a href="event:function=viewPublication,109">Focus: Globalization</a></p><br><p class="smaller_text">Students examine trade data for U.S. exports to and imports from China, and use the data to identify both nations' comparative advantage in trading with each other. They discuss which of three possible sources of comparative advantage might lie be...</p><br><p>--------------------------------------------------------------------</p><p><a href="event:function=viewLesson,67668"><b>Unit 2: Forest Resources</b></a><br><a href="event:function=viewPublication,110">Energy, Economics, and the Environment: Case Studies and Teaching Activities for High School</a></p><br><p class="smaller_text">Forest management in the United States has improved greatly since the early part of this century when our forests were often abused. Forest growth today is improving steadily, even in the face of increasing demand for wood products. Nevertheless, ...</p><br><p>--------------------------------------------------------------------</p><p><a href="event:function=viewLesson,62473"><b>Lesson 1: Where in the World?</b></a><br><a href="event:function=viewPublication,72">Geography: Focus on Economics</a></p><br><p class="smaller_text">Students participate in a bingo-type game to learn the national capitals of countries exporting specific resources and products, use prior knowledge and atlases to identify the countries involved, and locate both the countries and their capitals o...</p><br> <p>--------------------------------------------------------------------</p><p><a href="event:function=viewLesson,668"><b><font color="#CC6666">Online Lesson:</font> Henry Ford and the Model T: A Case Study in Productivity (Part 1)</b></a><br><a href='http://www.econedlink.org/' target='_blank'>EconEdLink.org</a></p><br><p class="smaller_text">When Henry Ford announced he was going to produce an automobile that would be affordable to the masses, he probably did not realize what a great impact his achievement would have on life in the United States and, eventually, the world. Ford’...</p><br><p class="tipHeading">Middle School Lessons</p><p>--------------------------------------------------------------------</p><p><a href="event:function=viewLesson,67914"><b>Unit 1: Basic Economic Concepts</b></a><br><a href="event:function=viewPublication,107">Energy, Economics, and the Environment: Case Studies and Teaching Activities for Elementary School</a></p><br><p class="smaller_text">One of the main purposes of this Energy, Economics, and the Environment (EEE) curriculum is to help students understand the economic implications of basic public policy issues concerning forests, water, and energy. Unit 1 teaches the basic economi...</p><br><p>--------------------------------------------------------------------</p><p><a href="event:function=viewLesson,67871"><b>Lesson 2 - Back-to-School Scarcity</b></a><br><a href="event:function=viewPublication,115">Focus: Economics - Grades 3-5</a></p><br><p class="smaller_text">While producing classroom decorations, student groups realize there is a scarcity of human resources. There are not enough students to produce the quantity of decorations the teacher requests in the time allowed. Because of scarcity each group m...</p><br><p>--------------------------------------------------------------------</p><p><a href="event:function=viewLesson,67870"><b>Lesson 1 - Rolling for Resources</b></a><br><a href="event:function=viewPublication,115">Focus: Economics - Grades 3-5</a></p><br><p class="smaller_text">This lesson is designed to introduce the concept of productive resources as human resources, natural resources or capital resources (goods). By playing a game, the students practice identifying and categorizing various resources. The game allows...</p><br><p>--------------------------------------------------------------------</p><p><a href="event:function=viewLesson,60337"><b>Lesson 7 - What a Difference a Tool Makes!</b></a><br><a href="event:function=viewPublication,53">Middle School World Geography: Focus on Economics</a></p><br><p class="smaller_text">In this lesson, the students use problem solving skills to make decisions about using productive resources. The students observe a simple production activity that gradually requires the use of more and more tools. After a short discussion regardin...</p><br><p>--------------------------------------------------------------------</p><p><a href="event:function=viewLesson,60331"><b>Lesson 1 - What Are Productive Resources?</b></a><br><a href="event:function=viewPublication,53">Middle School World Geography: Focus on Economics</a></p><br><p class="smaller_text">In this lesson, the students become economic detectives and try to determine how economists categorize productive resources. Working in groups, the students sort cards into categories they create and then specify the characteristics of each catego...</p><br><p>--------------------------------------------------------------------</p><p><a href="event:function=viewLesson,62637"><b>Lesson 7 - The T-riffic T's Company: Production Decisions</b></a><br><a href="event:function=viewPublication,49">Focus: Middle School Economics</a></p><br><p class="smaller_text">Students help the managers of a T-shirt company make business decisions about the production process. They analyze the costs and benefits of investing in new capital equipment in order to increase productivity.</p><br> <p>--------------------------------------------------------------------</p><p><a href="event:function=viewLesson,729"><b><font color="#CC6666">Online Lesson:</font> The Civil War: A War of Resources</b></a><br><a href='http://www.econedlink.org/' target='_blank'>EconEdLink.org</a></p><br><p class="smaller_text">The North won the Civil War in large part due to its superior resources. In this lesson students will learn the difference between capital resources, human capital, and natural resources. They will investigate and compare the resources held by t...</p><br><p>--------------------------------------------------------------------</p><p><a href="event:function=viewLesson,490"><b><font color="#CC6666">Online Lesson:</font> Where's the Beef?</b></a><br><a href='http://www.econedlink.org/' target='_blank'>EconEdLink.org</a></p><br><p class="smaller_text">Students explore meat consumption statistics, an indicator of a nation's relative prosperity and standard of living. They do a survey of a family's meat consumption and compare their results to statistics from Colonial and modern- day America.</p><br><p class="tipHeading">Elementary Lessons</p><p>--------------------------------------------------------------------</p><p><a href="event:function=viewLesson,67931"><b>Lesson 10: Follow an Ice-Cream Cone Around the World</b></a><br><a href="event:function=viewPublication,116">Teaching Economics Using Children's Literature</a></p><br><p class="smaller_text">Travel around the world with the Green$treet kids as they discover what it takes to make ice cream. Through this story, the students will visit the places where the different ingredients (natural resources) in ice cream are found. There are many...</p><br><p>--------------------------------------------------------------------</p><p><a href="event:function=viewLesson,67922"><b>Lesson 1: Charlie Needs a Cloak</b></a><br><a href="event:function=viewPublication,116">Teaching Economics Using Children's Literature</a></p><br><p class="smaller_text">Charlie and his favorite sheep produce a good - a new cloak. Students learn about the different productive resources (natural, human, and capital) that Charlie uses. Charlie does not specialize in his production - he does all the production step...</p><br><p>--------------------------------------------------------------------</p><p><a href="event:function=viewLesson,67119"><b>Lesson 7: Go Fly a Kite</b></a><br><a href="event:function=viewPublication,102">Mathematics & Economics: Connections for Life - 3-5</a></p><br><p class="smaller_text">This lesson focuses on resources and barter (economics) and geometry (mathematics). After reviewing the concept of bartering, the students roll a four-sided dice to gather some of the resources they will need to build a tetrahedron kite, which is ...</p><br><p>--------------------------------------------------------------------</p><p><a href="event:function=viewLesson,62627"><b>Lesson 3: Porridge from an Ax</b></a><br><a href="event:function=viewPublication,76">Resources A to Z</a></p><br><p class="smaller_text">In this lesson, students learn about natural, human, and capital resources, as well as ingredients (intermediate goods). They classify various resources and ingredients. Students listen to a Kyrgyz folk tale, learn about the resources used in th...</p><br><p>--------------------------------------------------------------------</p><p><a href="event:function=viewLesson,62626"><b>Lesson 2: Pyramids in Production</b></a><br><a href="event:function=viewPublication,76">Resources A to Z</a></p><br><p class="smaller_text">The Egyptians built pyramids for their rulers with four sloping outside walls shaped like triangles. These structures were tombs and could take twenty or more years to build. Workers used sleds, wooden rollers, and levers to move heavy stones of...</p><br><p>--------------------------------------------------------------------</p><p><a href="event:function=viewLesson,20972"><b>Unit 2: Lesson 6 - Mystery Workers</b></a><br><a href="event:function=viewPublication,16">Master Curriculum Guides in Economics: Teaching Strategies - K-2</a></p><br><p class="smaller_text">Students play a questioning game as they learn that producers use their human resources by working in jobs to make goods and services.</p><br> <p>--------------------------------------------------------------------</p><p><a href="event:function=viewLesson,711"><b><font color="#CC6666">Online Lesson:</font> The Color of Resources</b></a><br><a href='http://www.econedlink.org/' target='_blank'>EconEdLink.org</a></p><br><p class="smaller_text">This lesson will demonstrate the making of Crayola products to introduce natural, capital, and human resources as well as touching on some other aspects in the Crayola industry such as producers and consumers.</p><br><p>--------------------------------------------------------------------</p><p><a href="event:function=viewLesson,303"><b><font color="#CC6666">Online Lesson:</font> Where did that pencil come from? The Study of Natural Resources</b></a><br><a href='http://www.econedlink.org/' target='_blank'>EconEdLink.org</a></p><br><p class="smaller_text">The students will determine what goods can be produced from physical features such as rivers, lakes, mountains, and plains by looking at maps. Additionally, they will discuss the process these goods go through from nature to consumer.</p><br><p>--------------------------------------------------------------------</p><p><a href="event:function=viewLesson,540"><b><font color="#CC6666">Online Lesson:</font> Mystery Workers</b></a><br><a href='http://www.econedlink.org/' target='_blank'>EconEdLink.org</a></p><br><p class="smaller_text">In this lesson students review the concepts of goods, services, and producers using the Internet to locate examples of each in a teacher's classroom. They learn about the three kinds of resources necessary to produce goods and provide service...</p><br><p>--------------------------------------------------------------------</p><p><a href="event:function=viewLesson,464"><b><font color="#CC6666">Online Lesson:</font> Simple Simon Meets a Producer</b></a><br><a href='http://www.econedlink.org/' target='_blank'>EconEdLink.org</a></p><br><p class="smaller_text">A classic rhyme, Simple Simon and the Pie-Man, introduces students to the concepts of consumer and producer. Students learn that consumers are the people who buy and use goods and services. Producers make the goods and provide the services. When p...</p><br><p>--------------------------------------------------------------------</p><p><a href="event:function=viewLesson,389"><b><font color="#CC6666">Online Lesson:</font> The Little Red Hen</b></a><br><a href='http://www.econedlink.org/' target='_blank'>EconEdLink.org</a></p><br><p class="smaller_text">The Little Red Hen is a classic story for nearly all adults, and many children. Here it is retold and enhanced in order to provide a framework for illustrating and reviewing the concepts of productive resources and incentives. After reading t...</p><br>]]></lessons>
<tips><![CDATA[<p class="tipHeading">Tip #1</p><p>Productive resources are those things that can be used to make goods and services in the economy. These include natural resources, human resources and capital goods. The students should recognize that money is not a capital good--it is not a resource. Ask the students what good or service could be produced with a box or room full of money (none). Ask them what would have to be done to produce goods and services. (Money would have to be exchanged for natural resources, human resources and capital goods.)</p><br><p class="tipHeading">Tip #2</p><p>Productive resources are classified as land, labor and capital by many economists. Other classification methods also include entrepreneurship as a productive resource. Regardless of whether entrepreneurship is considered as a part of labor or as a separate resource, it is critical in a market economy. An entrepreneur recognizes human wants and takes risks to provide a good or service to satisfy those wants. Entrepreneurship is a major reason why predominantly market economies--economies with institutions that clearly define and enforce private property rights--innovate and progress more than predominantly command economies. Successful entrepreneurs focus their skills and brainpower on how to provide goods and services that others value highly. Entrepreneurs profit from this, and so do the people to whom they provide those goods and services.</p><br><p class="tipHeading">Tip #3</p><p>Ask the students to identify the resources used to make goods that are in your classroom such as chairs, tables and books. Then classify those resources as land, labor or capital.</p><br><p class="tipHeading">Tip #4</p><p>Some examples of productive resources are difficult to place in any of the resources categories because they are purchased by firms for further reprocessing and resale. Examples could include glue or paint. Some economists label this subcategory as intermediate goods.</p><br>]]></tips>
<resources><![CDATA[<p><b>Interactive tools:</b><br /></p><p><font color="#CC6666">Video</font> <a href='http://www.econedlink.org/i191' target='_blank'>Productive Resources</a></p><p>This video teaches the concept of Productive Resources. Productive resources are used to produce goods and services and are classified into four categories: land, labor, capital, and entrepreneurship.<br><font size="-10"><br /></font><font size="-3">Date Published: 07/12/2012<br>Grades: 3-5, 6-8, 9-12<br />Source: <a href='http://www.econedlink.org/' target='_blank'>EconEdLink.org</a></font></p><br><p><font color="#CC6666">Video</font> <a href='http://www.econedlink.org/i275' target='_blank'>Making Sen$e with Paul Solman: Manufacturer Vita Needle Finds Investment in Older Workers Turns a Big Profit</a></p><p>The average age of Vita Needle's workers is 74 years old, and that's no accident. The manufacturing company has intentionally hired seniors -- a decision that has increased profits and benefited older workers who often have a harder time finding a...<br><font size="-10"><br /></font><font size="-3">Date Published: 01/02/2013<br>Grades: 9-12<br />Source: <a href='http://www.econedlink.org/' target='_blank'>EconEdLink.org</a></font></p><br><p><font color="#CC6666">Video</font> <a href='http://www.econedlink.org/i264' target='_blank'>Making Sen$e with Paul Solman: Is Applying for Jobs Online Not an Effective Way to Find Work?</a></p><p>With a bad economy and nearly everyone on the internet, one job opening promoted online can receive thousands of applications. So with competition fierce and many firms using software rather than human beings to hire, Paul Solman explores whether ...<br><font size="-10"><br /></font><font size="-3">Date Published: 09/25/2012<br>Grades: 9-12<br />Source: <a href='http://www.econedlink.org/' target='_blank'>EconEdLink.org</a></font></p><br><p><font color="#CC6666">Video</font> <a href='http://www.econedlink.org/i167' target='_blank'>Making Sen$e with Paul Solman: How to Succeed in Business by Really, Really Trying</a></p><p>Is the aptitude for business (the legal kind) distributed among convicted criminals as it is in the general population? One seasoned executive thinks so, and believes that by hiring the cream of the ex-con crop, his company will have a leg up on t...<br><font size="-10"><br /></font><font size="-3">Date Published: 07/27/2011<br>Grades: 9-12<br />Source: <a href='http://www.econedlink.org/' target='_blank'>EconEdLink.org</a></font></p><br><p><font color="#CC6666">Video</font> <a href='http://www.econedlink.org/i60' target='_blank'>Making Sen$e with Paul Solman: George Shultz on Working at Age 89</a></p><p>George Shultz, former Secretary of State, Treasury, and Labor, discusses working at age 89.<br><font size="-10"><br /></font><font size="-3">Date Published: 12/16/2009<br>Grades: 9-12<br />Source: <a href='http://www.econedlink.org/' target='_blank'>EconEdLink.org</a></font></p><br><p>-------------------------------------</p><p><b>Lessons:</b></p><br><p><a href='http://www.econedlink.org/e676' target='_blank'>Henry Ford and the Model T: A Case Study in Productivity (Part 2)</a></p><p>When Henry Ford announced he was going to produce an automobile that would be affordable to the masses, he probably did not realize what a great impact his achievement would have on life in the United States. and, eventually, the world. Ford’s use of mass production strategies to manufacture the Model T revolutionized industrial manufacturing and initiated a new era in personal transportation. This three-part learning unit provides students with the story of Henry Ford and the Model T from an economics perspective. Parts 1 and 2 explore how the Ford Motor Company successfully introduced mass production strategies to the auto industry. Students learn how specialization and investments in capital (machines, people, etc.) increased productivity and allowed Ford to slash the price of his popular vehicle. Students chart a plan for the assembly line production of bookmarks, test their plan, and make recommendations for improvements. Students also explore how Henry Ford used economic incentives to address a problem created by mass production techniques—worker turnover. An optional Part 3 explains how increased productivity resulted in shifts in the supply and demand for the Model T. Students analyze how a variety of non-price determinants continue to influence the automobile market today. The unit also provides a wealth of extension activities. <br><font size="-10"><br /></font><font size="-3">Date Published: 01/05/2007<br />Grades: 6-8, 9-12<br />Source: <a href='http://www.econedlink.org/' target='_blank'>EconEdLink.org</a></font></p><br><p><a href='http://www.econedlink.org/e650' target='_blank'>Why does Brett Favre make $8.5 million per year?</a></p><p>What determines a person's salary? Why do professional athletes make so much money? People who work as firefighters, police officers or teachers are clearly more important to our society, yet they make much less money than jocks. What explains this?<br><font size="-10"><br /></font><font size="-3">Date Published: 06/06/2006<br />Grades: 9-12<br />Source: <a href='http://www.econedlink.org/' target='_blank'>EconEdLink.org</a></font></p><br><p><a href='http://www.econedlink.org/e389' target='_blank'>The Little Red Hen</a></p><p>The Little Red Hen is a classic story for nearly all adults, and many children. Here it is retold and enhanced in order to provide a framework for illustrating and reviewing the concepts of productive resources and incentives. After reading the story, students will categorize resources into land, labor, capital and entrepreneurship and be able to identify what future incentives the dog, the cat and the mouse will have to help the little hen in her work. Students will have the opportunity to explore bread making.<br><font size="-10"><br /></font><font size="-3">Date Published: 01/20/2003<br />Grades: K-2, 3-5<br />Source: <a href='http://www.econedlink.org/' target='_blank'>EconEdLink.org</a></font></p><br><p><a href='http://www.econedlink.org/e364' target='_blank'>Economic Spotter: Resources During World War II</a></p><p>In World War II pennies were made of steel and zinc instead of copper and women were working at jobs that men had always been hired to do. Why? Because during war times, scarcity forces many things to change!<br><font size="-10"><br /></font><font size="-3">Date Published: 01/03/2003<br />Grades: 3-5<br />Source: <a href='http://www.econedlink.org/' target='_blank'>EconEdLink.org</a></font></p><br><p><a href='http://www.econedlink.org/e229' target='_blank'>The Productive Blues (Jeans)</a></p><p>Upon completion of this lesson students will: identify examples of productive resources; categorize productive resources as human resources, capital resources, and natural resources; explain that an entrepreneur is a special type of human resource; identify examples of intermediate goods.<br><font size="-10"><br /></font><font size="-3">Date Published: 08/11/2003<br />Grades: 3-5, 6-8<br />Source: <a href='http://www.econedlink.org/' target='_blank'>EconEdLink.org</a></font></p><br>]]></resources>
<related>
<concept>10</concept>
<concept>57</concept>
<concept>58</concept>
</related>
<quiz>1</quiz>
</concept>
<concept>
<id>11</id>
<name>Productivity</name>
<category>0</category>
<definition><![CDATA[<p><b>Productivity</b> is measured as the quantity of output per unit of input. For example, labor productivity is measured as the quantity of output produced by an economy divided by the number of hours of <a href="event:function=defineGlossaryTerm,Labor">labor</a> input. A more complex measure of <a href="event:function=defineGlossaryTerm,Productivity">productivity</a> is the quantity of output produced by all inputs. An increase in productivity means producing more <a href="event:function=defineGlossaryTerm,Goods">goods</a> and <a href="event:function=defineGlossaryTerm,Services">services</a> with the same amount of <a href="event:function=defineGlossaryTerm,Resources">resources</a>, producing the same amount of goods and services with fewer resources or a combination of the two possibilities. Over time, productivity growth means that the average worker is producing more per hour, which means that the average <a href="event:function=defineGlossaryTerm,Standard of Living">standard of living</a> in the economy will be higher. This assumes that the additional output is of goods and services that people value. Producing more output that is of no value is not a real increase in productivity.</p>]]></definition>
<lessons><![CDATA[<p>Below are <b>featured</b> lessons for teaching Productivity.</p><br><p class="tipHeading">High School Lessons</p><p>--------------------------------------------------------------------</p><p><a href="event:function=viewLesson,67736"><b>Lesson 10: Rising Living Standards in the New Nation</b></a><br><a href="event:function=viewPublication,105">Focus: Understanding Economics in U.S. History</a></p><br><p class="smaller_text">The students participate in a simulation that demonstrates an increase in productivity. They discuss ways in which productivity can be increased; then they learn how technology, exemplified by Eli Whitney's cotton gin (1793), increased productivit...</p><br><p>--------------------------------------------------------------------</p><p><a href="event:function=viewLesson,17815"><b>Unit 4: Lesson 21 - Productivity, Diminishing Marginal Returns, and the Demand for Labor</b></a><br><a href="event:function=viewPublication,1">Capstone: Exemplary Lessons for High School Economics - Teacher's Guide</a></p><br><p class="smaller_text">Students produce greeting cards with a fixed number of scissors and markers, and a variable number of workers. They discuss factors affecting workers productivity and the law of diminishing marginal returns. With a partner, they use marginal ana...</p><br><p>--------------------------------------------------------------------</p><p><a href="event:function=viewLesson,15429"><b>Lesson 8 - Productivity</b></a><br><a href="event:function=viewPublication,2">Economics in Action: 14 Greatest Hits for Teaching High School Economics</a></p><br><p class="smaller_text">Working in small groups, the students participate in a production simulation to determine the effects of specialization on labor productivity, the division of labor, and investment in human capital and capital goods.</p><br><p>--------------------------------------------------------------------</p><p><a href="event:function=viewLesson,62515"><b>Lesson 10- How The Industrial Revolution Raised Living Standards</b></a><br><a href="event:function=viewPublication,70">World History: Focus on Economics</a></p><br><p class="smaller_text">The teacher conducts a brief simulation that illustrates how specialization and division of labor and improvements in capital goods increase productivity. The teacher displays a visual that shows other sources of increases in productivity. Studen...</p><br> <p>--------------------------------------------------------------------</p><p><a href="event:function=viewLesson,668"><b><font color="#CC6666">Online Lesson:</font> Henry Ford and the Model T: A Case Study in Productivity (Part 1)</b></a><br><a href='http://www.econedlink.org/' target='_blank'>EconEdLink.org</a></p><br><p class="smaller_text">When Henry Ford announced he was going to produce an automobile that would be affordable to the masses, he probably did not realize what a great impact his achievement would have on life in the United States and, eventually, the world. Ford’...</p><br><p>--------------------------------------------------------------------</p><p><a href="event:function=viewLesson,532"><b><font color="#CC6666">Online Lesson:</font> I Don't Want Much, I Just Want More: Allocation, Competition and Productivity</b></a><br><a href='http://www.econedlink.org/' target='_blank'>EconEdLink.org</a></p><br><p class="smaller_text">In this lesson, students will examine different methods for allocating resources, taking note of the cost and benefits associated with each method. This analysis will help students to understand competition and productivity as important elem...</p><br><p class="tipHeading">Middle School Lessons</p><p>--------------------------------------------------------------------</p><p><a href="event:function=viewLesson,68237"><b>Theme 2: Lesson 6 - Productivity</b></a><br><a href="event:function=viewPublication,136">Financial Fitness for Life: Grades 6-8 - Teacher Guide</a></p><br><p class="smaller_text">The students examine ways to develop their human capital. They discover that they make themselves more productive by developing their human capital and by using capital resources, the tools of their trade. As they become more productive, they beco...</p><br><p>--------------------------------------------------------------------</p><p><a href="event:function=viewLesson,67876"><b>Lesson 7 - The Shape of Production</b></a><br><a href="event:function=viewPublication,115">Focus: Economics - Grades 3-5</a></p><br><p class="smaller_text">In this simulation, the students act as workers to produce two-dimensional shapes using toothpicks and marshmallows. Through the timed production process, the students learn that specialization of labor and specialization of production lead to in...</p><br><p>--------------------------------------------------------------------</p><p><a href="event:function=viewLesson,65765"><b>Lesson 11 - If We Grow More Food, Won't We Degrade the Environment?</b></a><br><a href="event:function=viewPublication,95">Economics and the Environment: Ecodetectives</a></p><br><p class="smaller_text">The students examine evidence about the impact of modern farming. They analyze the costs and benefits of modern agricultural practices, noting that the benefits derive from improved productivity. They assess the possibility that continued improvem...</p><br><p>--------------------------------------------------------------------</p><p><a href="event:function=viewLesson,60338"><b>Lesson 8 - Ideas That Changed the World</b></a><br><a href="event:function=viewPublication,53">Middle School World Geography: Focus on Economics</a></p><br><p class="smaller_text">In this lesson, the students learn about productivity and its connection to the standard of living. They learn about inventions that changed the world. The students make predictions about recent inventions and the impact of these inventions on pro...</p><br> <p>--------------------------------------------------------------------</p><p><a href="event:function=viewLesson,539"><b><font color="#CC6666">Online Lesson:</font> WIDGET PRODUCTION: Producing More, Using Less</b></a><br><a href='http://www.econedlink.org/' target='_blank'>EconEdLink.org</a></p><br><p class="smaller_text">In the first part of the lesson students take a quiz to review the major concepts taught in Lesson 7, "Widget Production," from Master Curriculum Guide in Economics: Teaching Strategies 5-6. Students then search the web for examples...</p><br><p>--------------------------------------------------------------------</p><p><a href="event:function=viewLesson,263"><b><font color="#CC6666">Online Lesson:</font> Capital Chips (Part 1)</b></a><br><a href='http://www.econedlink.org/' target='_blank'>EconEdLink.org</a></p><br><p class="smaller_text">Through the use of a historical timeline of the capital investments made by the company the resulting benefits will be examined. The benefits from the capital investments of Herr Foods, Inc. will be related to their effect on the standard of...</p><br><p class="tipHeading">Elementary Lessons</p><p>--------------------------------------------------------------------</p><p><a href="event:function=viewLesson,67927"><b>Lesson 6: The Goat in the Rug</b></a><br><a href="event:function=viewPublication,116">Teaching Economics Using Children's Literature</a></p><br><p class="smaller_text">Geraldine the goal literally puts her whole self into the weaving of a Navajo rug. After being sheared for her wool, she watches as Glenmae cleans, dries, combs, spins, and dyes her wool. Geraldine is so proud. A lot of her is in that rug. She...</p><br><p>--------------------------------------------------------------------</p><p><a href="event:function=viewLesson,67117"><b>Lesson 5: The Math Factory</b></a><br><a href="event:function=viewPublication,102">Mathematics & Economics: Connections for Life - 3-5</a></p><br><p class="smaller_text">This lesson focuses on productivity (economics) and multiplication (mathematics). The students learn about physical capital and human capital as they create multiplication-fact review cards. In the first production round, groups of students produc...</p><br><p>--------------------------------------------------------------------</p><p><a href="event:function=viewLesson,61969"><b>Lesson 2 - Folding Our Way to Productivity</b></a><br><a href="event:function=viewPublication,37">Roosters to Robots: Lesson Plans from Writers around the World</a></p><br><p class="smaller_text">Students role-play workers producing origami cups. They participate in two production rounds, one without training and one with training. Students</p><br><p>--------------------------------------------------------------------</p><p><a href="event:function=viewLesson,62317"><b>Lesson 5: Getting More Out of Less</b></a><br><a href="event:function=viewPublication,58">Master Curriculum Guides in Economics: Teaching Strategies - 3-4</a></p><br><p class="smaller_text">Many decisions must be made to produce a good or service. For example, producers must make decisions about what to produce, what kind of building and tools are needed, what workers are needed, what materials are needed, what the costs of acquirin...</p><br> <p>--------------------------------------------------------------------</p><p><a href="event:function=viewLesson,478"><b><font color="#CC6666">Online Lesson:</font> Hawaiian Economics: Barter for Fish & Poi</b></a><br><a href='http://www.econedlink.org/' target='_blank'>EconEdLink.org</a></p><br><p class="smaller_text">In ancient Hawaii, chiefs managed the economy by creating a land division system, the Ahupua'a, which divided the islands into pie slice shapes. Each Ahupua'a covered the three main regions of the islands: the mountains, the valleys, and the ...</p><br>]]></lessons>
<tips><![CDATA[<p class="tipHeading">Tip #1</p><p>CEE has many excellent activities on productivity. Most involve moving the students through rounds of production to help them see that firms can increase productivity through: 1) division of labor/specialization, 2) investment in capital goods and 3) investment in human capital. It is essential that the same amount of time be allotted for production in each round. Have the students research tools (capital goods) and methods of production (e.g., moving assembly line, standardized parts, online collaboration) that led to increases in productivity in the United States.</p><br><p class="tipHeading">Tip #2</p><p>Students sometimes confuse productivity with production. Production is measured by real GDP, which is the market value of the total output of final goods and services produced during a certain time period. Productivity is the amount of goods and services produced per unit of input or per unit of the productive resources used. Productivity can be increased by producing more goods and services with the same amount of resources or by producing the same amount of goods and services with fewer resources.</p><br><p class="tipHeading">Tip #3</p><p>Increased productivity is important because a high income and standard of living are dependent upon higher productivity. Without higher productivity per worker, there cannot be higher wages per worker, which lead to more goods and services for the workers to consume and enjoy.</p><br>]]></tips>
<resources><![CDATA[<p><b>Interactive tools:</b><br /></p><p><font color="#CC6666">Video</font> <a href='http://www.econedlink.org/i246' target='_blank'>Making Sen$e with Paul Solman: Man vs. Machine: Will Human Workers Become Obsolete?</a></p><p>Part of his series on Making Sen$e of financial news, Paul Solman has been showcasing the future of technology from a recent conference run by a California think tank -- things such as 3-D printing of prosthetic legs and iPhone heart tests. But th...<br><font size="-10"><br /></font><font size="-3">Date Published: 05/24/2012<br>Grades: 9-12<br />Source: <a href='http://www.econedlink.org/' target='_blank'>EconEdLink.org</a></font></p><br><p><font color="#CC6666">Video</font> <a href='http://www.econedlink.org/i245' target='_blank'>Making Sen$e with Paul Solman: Downloadable Gun Parts, Personalized Bioterror: the Downside of Innovation</a></p><p>Through innovation and technology, California think tank Singularity University aims to push the frontiers of progress. But what happens when high-tech advances end up in the wrong hands? Economics correspondent Paul Solman raises some disturbing ...<br><font size="-10"><br /></font><font size="-3">Date Published: 04/26/2012<br>Grades: 9-12<br />Source: <a href='http://www.econedlink.org/' target='_blank'>EconEdLink.org</a></font></p><br><p><font color="#CC6666">Video</font> <a href='http://www.econedlink.org/i244' target='_blank'>Making Sen$e with Paul Solman: Tech's Next Feats? Maybe On-Demand Kidneys, Robot Sex, Cheap Solar, Lab Meat</a></p><p>Optimists at Silicon Valley think tank Singularity University are pushing the frontiers of human progress through innovation and emerging technologies, looking to greater longevity and better health. As part of his series on Making $ense of financ...<br><font size="-10"><br /></font><font size="-3">Date Published: 04/20/2012<br>Grades: 9-12<br />Source: <a href='http://www.econedlink.org/' target='_blank'>EconEdLink.org</a></font></p><br><p><font color="#CC6666">Video</font> <a href='http://www.econedlink.org/i185' target='_blank'>Division of Labor/Specialization</a></p><p>This video teaches the concepts of Division of Labor and Specialization. The division of labor refers to the practice that the tasks of producing a good or service are divided up into separate tasks. When workers focus on performing separate tasks...<br><font size="-10"><br /></font><font size="-3">Date Published: 07/12/2012<br>Grades: 6-8, 9-12<br />Source: <a href='http://www.econedlink.org/' target='_blank'>EconEdLink.org</a></font></p><br><p><font color="#CC6666">Video</font> <a href='http://www.econedlink.org/i192' target='_blank'>Productivity</a></p><p>This video teaches the concept of Productivity, which is measured as the quantity of output per unit of input.<br><font size="-10"><br /></font><font size="-3">Date Published: 07/12/2012<br>Grades: 6-8, 9-12<br />Source: <a href='http://www.econedlink.org/' target='_blank'>EconEdLink.org</a></font></p><br><p>-------------------------------------</p><p><b>Lessons:</b></p><br><p><a href='http://www.econedlink.org/e963' target='_blank'>Specialization and the Decathlon</a></p><p>This lesson uses results from the 2008 Summer Olympic Games to explain that athletes specialize in sports and events for which they are most skilled for the same reasons that individuals and nations specialize in the production of goods and services for which they have an absolute or a comparative advantage.<br><font size="-10"><br /></font><font size="-3">Date Published: 08/09/2011<br />Grades: 9-12<br />Source: <a href='http://www.econedlink.org/' target='_blank'>EconEdLink.org</a></font></p><br><p><a href='http://www.econedlink.org/e746' target='_blank'>Dumptown, USA: Making a Ton of Difference</a></p><p>The amount of trash produced in the United States is mounting with each passing year. Communities are finding it increasingly difficult and costly to handle trash disposal. Recycling is considered a key solution to the garbage problem. In this lesson, students explore the extent to which various types of solid waste contribute to the problem. They then assume the role of city managers who must choose recycling programs that will fit within a community's financial constraints. Students use marginal analysis to determine the most cost-effective solutions.<br><font size="-10"><br /></font><font size="-3">Date Published: 12/01/2008<br />Grades: 6-8<br />Source: <a href='http://www.econedlink.org/' target='_blank'>EconEdLink.org</a></font></p><br><p><a href='http://www.econedlink.org/e719' target='_blank'>Transportation: They Say We Had a Revolution (Part 1)</a></p><p>Advancements in transportation have played a key role in the growth of our nation. U.S.government policies have also had a considerable impact on the development of transport as we know it today. In this series of three lessons,the students examine transportation and its impact on our nation (and vice versa) since the United States declared its independence in 1776. Lesson 1 focuses on improvements in transportation during the 19th century, particularly the development of a national rail system, to show how invention, innovation and infrastructure encouraged western expansion and economic growth. Lesson 2 moves on to the 20thcentury focusing on the development of auto transport and aviation. The impact on communities and world trade, for both good and bad,is examined. Lesson 3 calls upon the students to create a class time line of transportation milestones; the time line will help the students more clearly understand the factors, especially the economic incentives,that have played a key role in what has been called the 'Transportation Revolution.' While these three lessons will ideally be used together as a set, teachers may choose to use one or two of them, selectively, to focus, for example, on the 19th or the 20th century. If you would like your students to study the economics of transportation in more depth, consider following up with the EconEdLink lesson, An Economic Mystery: What Happened to Railroads?<br><font size="-10"><br /></font><font size="-3">Date Published: 01/30/2008<br />Grades: 6-8, 9-12<br />Source: <a href='http://www.econedlink.org/' target='_blank'>EconEdLink.org</a></font></p><br><p><a href='http://www.econedlink.org/e702' target='_blank'>Work, Earnings and Economics: Using 'Lyddie' by Katherine Paterson</a></p><p>To get started, the students will read Lyddie, a novel by Katherine Paterson. The novel is set mainly in Lowell, Massachusetts, in the 1840s. In Lowell the main character, 13-year-old Lyddie Worthen, works six days a week, from dawn until dusk, running weaving looms in a murky dust-and lintfilled factory, trying to save enough money to reunite her family. In reading and discussing this fine novel, the students examine basic economic concepts and explore the growth of labor unions and the role of government in a market economy.
Lyddie is published by Puffin Books and is available at Amazon.com. It is also available in DVD video format and may be purchased on line at Circuit City, DVD Empire.com and Overstock.com.<br><font size="-10"><br /></font><font size="-3">Date Published: 09/13/2007<br />Grades: 6-8<br />Source: <a href='http://www.econedlink.org/' target='_blank'>EconEdLink.org</a></font></p><br><p><a href='http://www.econedlink.org/e692' target='_blank'>Henry Ford and the Model T: A Case Study in Productivity (Part 3)</a></p><p>When Henry Ford announced he was going to produce an automobile that would be affordable to the masses, it is doubtful even he realized the far reaching impact such an achievement would have on life in the U.S. and eventually, the world. Ford’s use of mass production strategies to manufacture the Model T revolutionized industrial manufacturing and initiated a new era in personal transportation. This 3-part learning unit provides students with the story of Henry Ford and the Model T from an economics perspective. Parts 1 and 2 explore how the Ford Motor Company successfully introduced mass production strategies to the auto industry. Students learn how specialization and investments in capital (machines, people, etc.) increased productivity and allowed Ford to slash the price of his popular vehicle. Students chart a plan for the assembly line production of bookmarks, test their plan and make recommendations for improvements. Students also explore how Henry Ford used economic incentives to address a problem created by mass production techniques—worker turnover. An optional Part 3 explains how increased productivity resulted in shifts in the supply and demand for the Model T. Students analyze how a variety of non price determinants continue to influence the automobile market today. A wealth of extension activities is provided if additional time is available.<br><font size="-10"><br /></font><font size="-3">Date Published: 01/15/2008<br />Grades: 6-8, 9-12<br />Source: <a href='http://www.econedlink.org/' target='_blank'>EconEdLink.org</a></font></p><br>]]></resources>
<related>
<concept>56</concept>
<concept>71</concept>
</related>
<quiz>1</quiz>
</concept>
<concept>
<id>70</id>
<name>Profit</name>
<category>2</category>
<definition><![CDATA[<p><b><a href="event:function=defineGlossaryTerm,Profit">Profit</a></b> is <a href="event:function=defineGlossaryTerm,Income">income</a> received for entrepreneurial skills or <a href="event:function=defineGlossaryTerm,Risk">risk</a> taking and is calculated by subtracting a firm's <a href="event:function=defineGlossaryTerm,Costs">costs</a> of producing a good or service from the <a href="event:function=defineGlossaryTerm,Revenue">revenues</a> received from selling the <a href="event:function=defineGlossaryTerm,Goods">good</a> or <a href="event:function=defineGlossaryTerm,Services">service</a>. Profit is income to <a href="event:function=defineGlossaryTerm,Business">business</a> owners.</p> <br><p>The desire for profit persuades <a href="event:function=defineGlossaryTerm,Entrepreneur">entrepreneurs</a> to establish new businesses, expand existing ones and change the kinds of goods and services produced. The desire for profit motivates owners and managers to introduce cost-cutting technologies and to compete more vigorously with other businesses for consumer dollars. Similarly, losses or negative profits are a signal to move <a href="event:function=defineGlossaryTerm,Resources">resources</a> elsewhere. In a competitive <a href="event:function=defineGlossaryTerm,Market Economy">market economy</a>, profits and losses spur efficiency, growth, change and economic progress.</p>]]></definition>
<lessons><![CDATA[<p>Below are <b>featured</b> lessons for teaching Profit.</p><br><p class="tipHeading">High School Lessons</p><p>--------------------------------------------------------------------</p><p><a href="event:function=viewLesson,67763"><b>Lesson 37: The Hispanic Americans</b></a><br><a href="event:function=viewPublication,105">Focus: Understanding Economics in U.S. History</a></p><br><p class="smaller_text">The students read information about the Hispanic population in the Southwest. They examine tables documenting increases in the population of the Southwest and the rise of the Hispanic (or Latino) population throughout the country. Using informatio...</p><br><p>--------------------------------------------------------------------</p><p><a href="event:function=viewLesson,15430"><b>Lesson 9 - The Invention Convention</b></a><br><a href="event:function=viewPublication,2">Economics in Action: 14 Greatest Hits for Teaching High School Economics</a></p><br><p class="smaller_text">Working in small groups, the students simulate firms creating and producing new products. Using budget guidelines, they must decide which inputs they will purchase. They calculate their costs of production and then display their products to the cl...</p><br><p>--------------------------------------------------------------------</p><p><a href="event:function=viewLesson,20823"><b>Lesson 9: Profit Mathematics</b></a><br><a href="event:function=viewPublication,11">Mathematics & Economics: Connections for Life - 9-12</a></p><br><p class="smaller_text">Most businesses in a market economy try to maximize profits. Economic profits are the difference between total revenue (the value of total sales for the business) and total cost (how much it costs the business to produce its goods or services). Wh...</p><br><p>--------------------------------------------------------------------</p><p><a href="event:function=viewLesson,65597"><b>Lesson 13: Where to Build a Factory</b></a><br><a href="event:function=viewPublication,69">Focus: International Economics</a></p><br><p class="smaller_text">Through discussion in small groups and reports to the full class, students evaluate the factors that influence decisions about where to invest abroad.</p><br><p>--------------------------------------------------------------------</p><p><a href="event:function=viewLesson,65717"><b>Lesson 1: A Parking Lot Full of Incentives</b></a><br><a href="event:function=viewPublication,63">Economies in Transition: Command to Market</a></p><br><p class="smaller_text">Students become familiar with the profit motive of market economies through a newspaper story about parking lot prices and whether government should intervene to control them. Next students play the role of parking lot managers in a command econo...</p><br><p>--------------------------------------------------------------------</p><p><a href="event:function=viewLesson,62447"><b>Lesson 7 - Business Decision Making: Are They Out to Get You?</b></a><br><a href="event:function=viewPublication,73">Personal Decision Making: Focus on Economics</a></p><br><p class="smaller_text">This lesson helps students understand that businesses must consider the cost of producing their products and how those costs affect their profits. Many teachers form elaborate classroom corporations in order to help their students gain an underst...</p><br> <p>--------------------------------------------------------------------</p><p><a href="event:function=viewLesson,772"><b><font color="#CC6666">Online Lesson:</font> Marketplace: MIT Business Plan Competition</b></a><br><a href='http://www.econedlink.org/' target='_blank'>EconEdLink.org</a></p><br><p class="smaller_text">The Sloan School of Business at Massachusetts Institute of Technology (MIT) hosts a yearly competition for the best business plan. It's not just your average science fair project. Many entrepreneurs have used the money they won in the MIT competit...</p><br><p>--------------------------------------------------------------------</p><p><a href="event:function=viewLesson,762"><b><font color="#CC6666">Online Lesson:</font> Marketplace: The Trouble with Truffles</b></a><br><a href='http://www.econedlink.org/' target='_blank'>EconEdLink.org</a></p><br><p class="smaller_text">In this lesson students watch a 60 minutes report on the market for truffles. The report explains how high demand from consumers coupled with the uncontrollable nature of truffle production affects the market. Students identify major concepts in t...</p><br><p>--------------------------------------------------------------------</p><p><a href="event:function=viewLesson,75"><b><font color="#CC6666">Online Lesson:</font> Baseball Economics 101</b></a><br><a href='http://www.econedlink.org/' target='_blank'>EconEdLink.org</a></p><br><p class="smaller_text">As any baseball fan can tell you, the New York Yankees have won three of the last four World Series championships. The Yankees' recent success--as well as the success of other big market, high revenue teams--has led many to question whether s...</p><br><p class="tipHeading">Middle School Lessons</p><p>--------------------------------------------------------------------</p><p><a href="event:function=viewLesson,67874"><b>Lesson 5 - Flagging Profits</b></a><br><a href="event:function=viewPublication,115">Focus: Economics - Grades 3-5</a></p><br><p class="smaller_text">In this lesson, the students work in groups to produce flags. Each group determines the total cost of its resources and intermediate goods and the unit cost of its flag. Then each group draws a card that determines the selling price for its flag...</p><br><p>--------------------------------------------------------------------</p><p><a href="event:function=viewLesson,62203"><b>Chapter 3: Lesson 5 - Could Buying Trees at Christmas Be Forest-Friendly?</b></a><br><a href="event:function=viewPublication,45">The Great Economic Mysteries Book: A Guide to Teaching Economic Reasoning, Grades 4-8</a></p><br><p class="smaller_text">Students describe an economic mystery and discuss various explanations of it. They use economic principles and true/false clues in reasoning out a solution to the mystery.</p><br><p>--------------------------------------------------------------------</p><p><a href="event:function=viewLesson,62639"><b>Lesson 9 - The Profit Puzzle</b></a><br><a href="event:function=viewPublication,49">Focus: Middle School Economics</a></p><br><p class="smaller_text">Students help Pierre determine which items to continue to sell in his bakery, based on identifying the most profitable items. The concepts are reinforced as students make similar decisions for opening a school snack bar.</p><br> <p>--------------------------------------------------------------------</p><p><a href="event:function=viewLesson,476"><b><font color="#CC6666">Online Lesson:</font> I Can Be an Entrepreneur</b></a><br><a href='http://www.econedlink.org/' target='_blank'>EconEdLink.org</a></p><br><p class="smaller_text">Learners are given advice on how they can earn extra money by becoming an entrepreneur. After investigating several web pages that offer examples of what other people their age have done to earn money, students identify three money-making ideas fo...</p><br><p>--------------------------------------------------------------------</p><p><a href="event:function=viewLesson,403"><b><font color="#CC6666">Online Lesson:</font> Bringing the Market to the Farm</b></a><br><a href='http://www.econedlink.org/' target='_blank'>EconEdLink.org</a></p><br><p class="smaller_text">Students learn how community supported agriculture (CSAs) is changing the relationship between the farmer and the consumer.</p><br><p class="tipHeading">Elementary Lessons</p><p>--------------------------------------------------------------------</p><p><a href="event:function=viewLesson,68165"><b>Theme 1: Lesson 2 - Urban Mouse and Rural Mouse</b></a><br><a href="event:function=viewPublication,134">Financial Fitness for Life: Grades 3-5 - Teacher Guide</a></p><br><p class="smaller_text">The students use an index of businesses for a fictional community to learn why people create businesses to provide goods and services in their communities. They read an adaptation of the fable 'City Mouse, Country Mouse,' here titled 'Urban Mouse ...</p><br><p>--------------------------------------------------------------------</p><p><a href="event:function=viewLesson,67118"><b>Lesson 6: Bookmark Profit</b></a><br><a href="event:function=viewPublication,102">Mathematics & Economics: Connections for Life - 3-5</a></p><br><p class="smaller_text">This lesson focuses on profit (economics) and basic operations (mathematics). Working in small groups, the students act as companies and produce bookmarks. They decide which resources to purchase to produce their bookmarks. They calculate their co...</p><br><p>--------------------------------------------------------------------</p><p><a href="event:function=viewLesson,61984"><b>Lesson 3: What Happens When a Bank Makes a Loan?</b></a><br><a href="event:function=viewPublication,101">Learning, Earning and Investing: Grades 4-5 Lessons</a></p><br><p class="smaller_text">The students play roles in a simulation activity designed to show how bank loans made to individuals can have an impact on others in the community. Then, working in small groups, the students analyze other hypothetical loans, using flow charts or ...</p><br><p>--------------------------------------------------------------------</p><p><a href="event:function=viewLesson,62353"><b>Lesson 8: Creative Toy Production</b></a><br><a href="event:function=viewPublication,59">Master Curriculum Guides in Economics: Teaching Strategies - 5-6</a></p><br><p class="smaller_text">In a market (price) system, economic decisions are made in the marketplace through the interaction of consumers and producers. Businesses produce and sell the goods and services consumers desire. Firms buy factors of production (resources or inp...</p><br><p>--------------------------------------------------------------------</p><p><a href="event:function=viewLesson,62327"><b>Lesson 15: An Entrepreneurial Experience Extraordinaire</b></a><br><a href="event:function=viewPublication,58">Master Curriculum Guides in Economics: Teaching Strategies - 3-4</a></p><br><p class="smaller_text">In the previous lesson students established a company and participated in various preproduction activities. This lesson involves the implementation of production, marketing, and distribution decisions for Orange Juice Jubilee. Students will concl...</p><br> <p>--------------------------------------------------------------------</p><p><a href="event:function=viewLesson,387"><b><font color="#CC6666">Online Lesson:</font> Old toy - new market</b></a><br><a href='http://www.econedlink.org/' target='_blank'>EconEdLink.org</a></p><br><p class="smaller_text">Students explore the LEGOLAND theme parks and demonstrate an understanding of how new markets can be created and that cultural and social differences can affect these markets.</p><br><p>--------------------------------------------------------------------</p><p><a href="event:function=viewLesson,155"><b><font color="#CC6666">Online Lesson:</font> An Entreduction</b></a><br><a href='http://www.econedlink.org/' target='_blank'>EconEdLink.org</a></p><br><p class="smaller_text">This lesson illustrates the differences between inventions and innovations. It discusses what entrepreneurs are and their role with inventions and innovations.</p><br>]]></lessons>
<tips><![CDATA[<p class="tipHeading">Tip #1</p><p>Some students and many in the entertainment media express the idea that profit is a zero-sum game. These people view an increase in profits as meaning that somehow money is being stolen from the poor and given to the rich. An economic explanation of profit stresses that it is the primary incentive used in a market economy to reward producers for providing consumers with the goods and services they desire.</p><br><p class="tipHeading">Tip #2</p><p>Students often confuse revenues and profits. Ask your students how much they paid for their backpack or some other item. Next, ask how much profit the store that sold the backpack earned. Most students will tell you that the price they paid is the amount of profit the store earned. Use this example to help them recognize that the price paid for the backpack is revenue for the store, and that from its revenue the store must pay its costs. What is left after the store pays its costs is profit. Have the students identify some of the costs the store must pay, e.g., salary for workers, payment for items sold in the store, rent, electricity and water service.</p><br><p class="tipHeading">Tip #3</p><p>Students often see profit as benefiting only businesses. The important thing about profits and losses is that they direct businesses toward producing the goods and services that consumers value more and away from producing the goods and services that consumers value less. Profits reward firms that produce efficiently and correctly anticipate which goods and services consumers want most. Inefficient businesses and firms that do not adapt to changes in consumer preferences and technology are penalized by incurring losses.</p><br>]]></tips>
<resources><![CDATA[<p><b>Interactive tools:</b><br /></p><p><font color="#CC6666">Video</font> <a href='http://www.econedlink.org/i265' target='_blank'>Never Too Young: Personal Finance for Young Learners</a></p><p>This program was developed in response to a growing interest in teaching students about personal finance through settings outside of the traditional school day. The program teaches young students about financial choices, cost‐benefit analysis fo...<br><font size="-10"><br /></font><font size="-3">Date Published: 10/19/2012<br>Grades: K-2, 3-5<br />Source: <a href='http://www.econedlink.org/' target='_blank'>EconEdLink.org</a></font></p><br><p><font color="#CC6666">Video</font> <a href='http://www.econedlink.org/i270' target='_blank'>Making Sen$e with Paul Solman: Climate Change Causes Insurers to Rethink Price of Risk After Hurricane Sandy</a></p><p>The insurance industry looks at historical data, old and new, in order to assess the risk for potential disasters and put a price on premiums. But when Sandy hit the Northeast, some insurance companies reconsidered if they priced insurance high en...<br><font size="-10"><br /></font><font size="-3">Date Published: 11/21/2012<br>Grades: 9-12<br />Source: <a href='http://www.econedlink.org/' target='_blank'>EconEdLink.org</a></font></p><br><p><font color="#CC6666">Video</font> <a href='http://www.econedlink.org/i263' target='_blank'>Making Sen$e of Health Care: Competing Claims on Campaign Trail About Reform</a></p><p>Paul Solman compares and contrasts "Obamacare" policy with health care reform proposals from Mitt Romney. Economists on both sides of the political debate discuss increasing efficiency, technological innovation, market competition and vouchers.<br><font size="-10"><br /></font><font size="-3">Date Published: 09/11/2012<br>Source: <a href='http://www.econedlink.org/' target='_blank'>EconEdLink.org</a></font></p><br><p><font color="#CC6666">Video</font> <a href='http://www.econedlink.org/i208' target='_blank'>Competition and Market Structures</a></p><p>This video teaches the concept of Competition and Market Structures. In the context of markets, competition refers to the situation when producers would each like to sell their goods or services to the same customers. The great benefit of competit...<br><font size="-10"><br /></font><font size="-3">Date Published: 07/12/2012<br>Grades: 6-8, 9-12<br />Source: <a href='http://www.econedlink.org/' target='_blank'>EconEdLink.org</a></font></p><br><p><font color="#CC6666">Video</font> <a href='http://www.econedlink.org/i212' target='_blank'>Entrepreneurs</a></p><p>This video teaches the concept of Entrepreneurs. Entrepreneurs are willing to risk their own resources in order to sell them for financial gain or profits. They are successful when they provide consumers with goods and services that consumers high...<br><font size="-10"><br /></font><font size="-3">Date Published: 07/12/2012<br>Grades: 3-5, 6-8, 9-12<br />Source: <a href='http://www.econedlink.org/' target='_blank'>EconEdLink.org</a></font></p><br><p>-------------------------------------</p><p><b>Lessons:</b></p><br><p><a href='http://www.econedlink.org/e476' target='_blank'>I Can Be an Entrepreneur</a></p><p>Learners are given advice on how they can earn extra money by becoming an entrepreneur. After investigating several web pages that offer examples of what other people their age have done to earn money, students identify three money-making ideas for themselves such as: considering what they would enjoy doing, what they do well, what people are willing to buy, the need to set a price that will be profitable, and safety. In a follow-up activity, students are given tips on how they might advertise what they are selling. They prepare flyers to promote one of their ideas for earning money. For an introduction to earning and other ways people get money, the instructor may want to first use the lesson 'Money Doesn’t Grow on Trees.'
<br><font size="-10"><br /></font><font size="-3">Date Published: 10/30/2003<br />Grades: 3-5, 6-8<br />Source: <a href='http://www.econedlink.org/' target='_blank'>EconEdLink.org</a></font></p><br><p><a href='http://www.econedlink.org/e727' target='_blank'>Transportation: They Say We Had a Revolution (Part 3)</a></p><p>Advancements in transportation have played a key role in the growth of our nation. U.S. government policies have also had a considerable impact on the development of transport as we know it today. In this series of three lessons, the students examine transportation and its impact on our nation (and vice versa) since the United States declared its independence in 1776. Lesson 1 focuses on improvements in transportation during the 19th century, particularly the development of a national rail system, to show how invention, innovation and infrastructure encouraged western expansion and economic growth. Lesson 2 moves on to the 20th century focusing on the development of auto transport and aviation. The impact on communities and world trade, for both good and bad,is examined. Lesson 3 calls upon the students to create a class timeline of transportation milestones; the timeline will help the students more clearly understand the factors, especially the economic incentives, that have played a key role in what has been called the "Transportation Revolution." While these three lessons will ideally be used together as a set, teachers may choose to use one or two of them, selectively, to focus, for example, on the 19th or the 20th century. If you would like your students to study the economics of transportation in more depth, consider following up with the EconEdLink lesson,An Economic Mystery: What Happened to Railroads?<br><font size="-10"><br /></font><font size="-3">Date Published: 02/05/2008<br />Grades: 6-8, 9-12<br />Source: <a href='http://www.econedlink.org/' target='_blank'>EconEdLink.org</a></font></p><br><p><a href='http://www.econedlink.org/e664' target='_blank'>The Price of Gasoline: What's Behind It?</a></p><p>In this lesson, students investigate the variables that contribute to the cost of gasoline. They learn that while OPEC nations do influence the price of oil and thus the price of gasoline, other factors also influence the price.<br><font size="-10"><br /></font><font size="-3">Date Published: 07/21/2006<br />Grades: 6-8<br />Source: <a href='http://www.econedlink.org/' target='_blank'>EconEdLink.org</a></font></p><br><p><a href='http://www.econedlink.org/e203' target='_blank'>A Fair Wage</a></p><p>Income for most people is determined by the market value of the productive resources they sell. What workers earn depends, primarily, on the market value of what they produce and how productive they are.<br><font size="-10"><br /></font><font size="-3">Date Published: 09/27/2001<br />Grades: 6-8, 9-12<br />Source: <a href='http://www.econedlink.org/' target='_blank'>EconEdLink.org</a></font></p><br><p><a href='http://www.econedlink.org/e1074' target='_blank'>Spotlighting Entrepreneurs: A Technology "iCon"</a></p><p>What better way to address Common Core standards in Reading Informational Text than by meeting a gentleman that changed the world of technology!<br><font size="-10"><br /></font><font size="-3">Date Published: 03/11/2013<br />Grades: 3-5<br />Source: <a href='http://www.econedlink.org/' target='_blank'>EconEdLink.org</a></font></p><br>]]></resources>
<related>
<concept>69</concept>
<concept>67</concept>
<concept>25</concept>
</related>
<quiz>1</quiz>
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<concept>
<id>55</id>
<name>Property Rights</name>
<category>0</category>
<definition><![CDATA[<p><b>Property rights </b>refer to the legal ownership of<a href="event:function=defineGlossaryTerm,Resources"> resources</a>, which include the right to own, use and sell them. <a href="event:function=defineGlossaryTerm,Property Rights">Property rights</a> are essential to the transactions in a <a href="event:function=defineGlossaryTerm,Market Economy">market economy</a>, and one of the essential roles of government in a market-oriented economy is to protect property rights. When <a href="event:function=defineGlossaryTerm,Goods">goods</a>, including everything from cars to groceries, are bought and sold, a property right is transferred from one party to the other. Your ownership of your own <a href="event:function=defineGlossaryTerm,Labor">labor</a>, that is, your property rights in your own labor, is what gives you the right to be paid for your <a href="event:function=defineGlossaryTerm,Work">work</a>. Without property rights and ownership, firms would lack any reason to build factories, produce and innovate, because they wouldn't be able to keep what they made or earned. Similarly, people and <a href="event:function=defineGlossaryTerm,Firms">firms</a> would have a greatly reduced <a href="event:function=defineGlossaryTerm,Incentive">incentive</a> to <a href="event:function=defineGlossaryTerm,Save">save</a> or <a href="event:function=defineGlossaryTerm,Investing">invest</a>, because they wouldn't be confident of receiving the future value from doing so.</p>]]></definition>
<lessons><![CDATA[<p>Below are <b>featured</b> lessons for teaching Property Rights.</p><br><p class="tipHeading">High School Lessons</p><p>--------------------------------------------------------------------</p><p><a href="event:function=viewLesson,68041"><b>Lesson 15 - The Judiciary and Eminent Domain: the Case of Kelo v. City of New London</b></a><br><a href="event:function=viewPublication,118">Focus: Understanding Economics in Civics and Government</a></p><br><p class="smaller_text">The students learn about the importance of private property rights and the enforcement of those rights. They are introduced to the concept of eminent domain and its grounding in the Fifth Amendment to the U.S. Constitution. To explore issues of pr...</p><br><p>--------------------------------------------------------------------</p><p><a href="event:function=viewLesson,67728"><b>Lesson 2: Property Rights Among North American Indians</b></a><br><a href="event:function=viewPublication,105">Focus: Understanding Economics in U.S. History</a></p><br><p class="smaller_text">In their exploration of property rights among North American Indians, the students discuss the tragedy of the commons. They read a case study that explains how Indians developed ownership rights regarding horses. Then they examine other examples o...</p><br><p>--------------------------------------------------------------------</p><p><a href="event:function=viewLesson,60252"><b>Lesson 2: Property Rights and Contracts as Economic Institutions</b></a><br><a href="event:function=viewPublication,39">Focus: Institutions and Markets</a></p><br><p class="smaller_text">Students consider the importance of a system of defining, recording and protecting property rights in a market-based economy. Students differentiate between private and communal property, they consider various methods for recording property owner...</p><br><p>--------------------------------------------------------------------</p><p><a href="event:function=viewLesson,15425"><b>Lesson 4 - Property Rights in a Market Economy</b></a><br><a href="event:function=viewPublication,2">Economics in Action: 14 Greatest Hits for Teaching High School Economics</a></p><br><p class="smaller_text">Students discuss private property, free enterprise, self-interest, competition, a system of markets and prices, and limited government as characteristics of market economies. They participate in or observe an activity demonstrating that property ...</p><br><p>--------------------------------------------------------------------</p><p><a href="event:function=viewLesson,63113"><b>Lesson 3: Property Rights, the Tragedy of the Commons, and the Coase Theorem</b></a><br><a href="event:function=viewPublication,74">Focus: Economic Systems</a></p><br><p class="smaller_text">Students participate in simulations of a collective farm and an equal-shares society. Then they use simple numerical examples to demonstrate the relationship between collective ownership and the tragedy of the commons. Finally, they analyze a ca...</p><br><p>--------------------------------------------------------------------</p><p><a href="event:function=viewLesson,65603"><b>Lesson 19: Privatization Around the World</b></a><br><a href="event:function=viewPublication,69">Focus: International Economics</a></p><br><p class="smaller_text">In this lesson, students review and evaluate the approaches most widely used to privatize public enterprises and services. They also review some international comparisons on the success of these programs in different nations. In the assessment s...</p><br> <p>--------------------------------------------------------------------</p><p><a href="event:function=viewLesson,582"><b><font color="#CC6666">Online Lesson:</font> New Sense, Inc. vs. Fish 'Till U Drop or Coase Vs. Pigou</b></a><br><a href='http://www.econedlink.org/' target='_blank'>EconEdLink.org</a></p><br><p class="smaller_text">Hot debate and arguments galore whirl around this question: "Which economic approach is the most efficient and fair to resolve utility issues surrounding the use of common or public property?" This lesson will explore, examine and analy...</p><br><p>--------------------------------------------------------------------</p><p><a href="event:function=viewLesson,186"><b><font color="#CC6666">Online Lesson:</font> Online Mayhem I: Metallica Versus Napster</b></a><br><a href='http://www.econedlink.org/' target='_blank'>EconEdLink.org</a></p><br><p class="smaller_text">"Metallica Brings Lawsuit"; "Metallica Alleges Theft"; "Metallica Demands Napster Site Shutdown". What is Metallica's problem? As you probably know, Metallica is a rock band and the band members are upset at a web...</p><br><p class="tipHeading">Middle School Lessons</p><p>--------------------------------------------------------------------</p><p><a href="event:function=viewLesson,65761"><b>Lesson 7 - Can Incentives Protect Endangered Species?</b></a><br><a href="event:function=viewPublication,95">Economics and the Environment: Ecodetectives</a></p><br><p class="smaller_text">The students discuss ways to protect fish placed on display in a science class. By viewing visuals, they learn about key provisions of the Endangered Species Act. They role-play international commissioners and make recommendations regarding polici...</p><br><p>--------------------------------------------------------------------</p><p><a href="event:function=viewLesson,65757"><b>Lesson 3 - Why Do We Have So Few Whales and So Many Chickens?</b></a><br><a href="event:function=viewPublication,95">Economics and the Environment: Ecodetectives</a></p><br><p class="smaller_text">The students participate in a classroom simulation that demonstrates the tragedy of the commons. Next, the simulation is altered by an introduction of property rights, and the simulation outcome changes. Then the students solve the mystery of the ...</p><br><p>--------------------------------------------------------------------</p><p><a href="event:function=viewLesson,62210"><b>Chapter 3: Lesson 12 - Why Is the School Lunchroom Always Dirty?</b></a><br><a href="event:function=viewPublication,45">The Great Economic Mysteries Book: A Guide to Teaching Economic Reasoning, Grades 4-8</a></p><br><p class="smaller_text">Students describe an economic mystery and discuss various explanations of it. They use economic principles and true/false clues in reasoning out a solution to the mystery.</p><br> <p>--------------------------------------------------------------------</p><p><a href="event:function=viewLesson,462"><b><font color="#CC6666">Online Lesson:</font> The Mystery of is it Mine or Ours?</b></a><br><a href='http://www.econedlink.org/' target='_blank'>EconEdLink.org</a></p><br><p class="smaller_text">Did you ride to school on a road today? Yesterday did you skate in a public park? Maybe Mom or Dad traveled home from one of your ball games on their bicycles under a string of street lights? How did the road, the park or the street lights ge...</p><br>]]></lessons>
<tips><![CDATA[<p class="tipHeading">Tip #1</p><p>Market systems cannot function well without clearly defined, well enforced property rights because property rights send clear signals on who is rewarded for caring for the resource and who is liable if it is used poorly. When property rights are unclear or not enforced, the resource will be overused in the marketplace. Examples such as the markets for elephant ivory and caviar demonstrate how a resource can be overused and depleted when property rights are not clear. Other examples like chickens and cattle demonstrate how a resource can be used aggressively but not depleted if property rights are clear.</p><br><p class="tipHeading">Tip #2</p><p>Why are well defined property rights so important? First, property ownership encourages wise use of the resource. Are you more concerned with changing the oil in a car you own or a car you rent? Second, private ownership encourages people to use their property productively because this increases its value. Third, private sellers will try to use their property for the benefit of others because this increases its value. Because they will benefit from a higher price, people improve their homes in ways that make the homes more attractive to potential buyers. Finally, owning property encourages its wise development and conservation for the future. Why are there more cattle than whales? Why is commonly owned property often abused? </p><br>]]></tips>
<resources><![CDATA[<p><b>Interactive tools:</b><br /></p><p><font color="#CC6666">Video</font> <a href='http://www.econedlink.org/i186' target='_blank'>Economic Institutions</a></p><p>This video teaches the concept of Economic Institutions. Economic institutions refer to the established laws, customs, organizations or systems that have a strong impact on economic decisions.<br><font size="-10"><br /></font><font size="-3">Date Published: 07/12/2012<br>Grades: 9-12<br />Source: <a href='http://www.econedlink.org/' target='_blank'>EconEdLink.org</a></font></p><br><p><font color="#CC6666">Video</font> <a href='http://www.econedlink.org/i188' target='_blank'>Incentives</a></p><p>This video teaches the concept of Incentives. An incentive is a cost or benefit that motivates a decision or action by consumers, workers, firms or other participants in the economy.<br><font size="-10"><br /></font><font size="-3">Date Published: 07/12/2012<br>Grades: 3-5, 6-8, 9-12<br />Source: <a href='http://www.econedlink.org/' target='_blank'>EconEdLink.org</a></font></p><br><p><font color="#CC6666">Video</font> <a href='http://www.econedlink.org/i193' target='_blank'>Property Rights</a></p><p>This video teaches the concept of Property Rights, which refers to the legal ownership of resources, including the right to own, use and sell them. Property rights are essential to the transactions in a market economy, and one of the essential rol...<br><font size="-10"><br /></font><font size="-3">Date Published: 07/12/2012<br>Grades: 6-8, 9-12<br />Source: <a href='http://www.econedlink.org/' target='_blank'>EconEdLink.org</a></font></p><br><p><font color="#CC6666">Video</font> <a href='http://www.econedlink.org/i126' target='_blank'>Making Sen$e with Paul Solman: The Current State of Religion in America</a></p><p>Paul Solman sits down with political scientist Robert Putnam to discuss his new book "American Grace", about the current role religion plays in America.<br><font size="-10"><br /></font><font size="-3">Date Published: 10/11/2010<br>Grades: 9-12<br />Source: <a href='http://www.econedlink.org/' target='_blank'>EconEdLink.org</a></font></p><br><p>-------------------------------------</p><p><b>Lessons:</b></p><br><p><a href='http://www.econedlink.org/e966' target='_blank'>Green Eggs and ...Economics?</a></p><p>Economic concepts are often found in places students have never considered, like children’s literature. In this lesson, students will explore the various economic concepts addressed in five of Dr. Seuss' most popular books: The Cat in the Hat; Green Eggs and Ham; The Lorax; Oh, the Places You’ll Go! and Horton Hears a Who! This lesson assumes the students already have some knowledge of basic microeconomic concepts. Therefore, it would be best utilized as a review or unit summary to reinforce the concepts you have already covered.<br><font size="-10"><br /></font><font size="-3">Date Published: 01/19/2012<br />Grades: 9-12<br />Source: <a href='http://www.econedlink.org/' target='_blank'>EconEdLink.org</a></font></p><br><p><a href='http://www.econedlink.org/e727' target='_blank'>Transportation: They Say We Had a Revolution (Part 3)</a></p><p>Advancements in transportation have played a key role in the growth of our nation. U.S. government policies have also had a considerable impact on the development of transport as we know it today. In this series of three lessons, the students examine transportation and its impact on our nation (and vice versa) since the United States declared its independence in 1776. Lesson 1 focuses on improvements in transportation during the 19th century, particularly the development of a national rail system, to show how invention, innovation and infrastructure encouraged western expansion and economic growth. Lesson 2 moves on to the 20th century focusing on the development of auto transport and aviation. The impact on communities and world trade, for both good and bad,is examined. Lesson 3 calls upon the students to create a class timeline of transportation milestones; the timeline will help the students more clearly understand the factors, especially the economic incentives, that have played a key role in what has been called the "Transportation Revolution." While these three lessons will ideally be used together as a set, teachers may choose to use one or two of them, selectively, to focus, for example, on the 19th or the 20th century. If you would like your students to study the economics of transportation in more depth, consider following up with the EconEdLink lesson,An Economic Mystery: What Happened to Railroads?<br><font size="-10"><br /></font><font size="-3">Date Published: 02/05/2008<br />Grades: 6-8, 9-12<br />Source: <a href='http://www.econedlink.org/' target='_blank'>EconEdLink.org</a></font></p><br><p><a href='http://www.econedlink.org/e582' target='_blank'>New Sense, Inc. vs. Fish 'Till U Drop or Coase Vs. Pigou</a></p><p>Hot debate and arguments galore whirl around this question: "Which economic approach is the most efficient and fair to resolve utility issues surrounding the use of common or public property?" This lesson will explore, examine and analyze this perplexing question by engaging in an open-ended role play simulation.<br><font size="-10"><br /></font><font size="-3">Date Published: 08/05/2005<br />Grades: 9-12<br />Source: <a href='http://www.econedlink.org/' target='_blank'>EconEdLink.org</a></font></p><br><p><a href='http://www.econedlink.org/e462' target='_blank'>The Mystery of is it Mine or Ours?</a></p><p>Did you ride to school on a road today? Yesterday did you skate in a public park? Maybe Mom or Dad traveled home from one of your ball games on their bicycles under a string of street lights? How did the road, the park or the street lights get there? Who paid for them? As a matter of fact, just who owns them? Sounds like a mystery worthy of Sherlock Holmes!
Discuss with your class the following: Did you ride to school on a road today? Yesterday did you skate in a public park? Maybe Mom or Dad traveled home from one of your ball games on their bicycles under a string of street lights? How did the road, the park or the street lights get there? Who paid for them? As a matter of fact, just who owns them? Sounds like a mystery worthy of Sherlock Holmes!<br><font size="-10"><br /></font><font size="-3">Date Published: 08/22/2003<br />Grades: 6-8<br />Source: <a href='http://www.econedlink.org/' target='_blank'>EconEdLink.org</a></font></p><br><p><a href='http://www.econedlink.org/e186' target='_blank'>Online Mayhem I: Metallica Versus Napster</a></p><p>"Metallica Brings Lawsuit"; "Metallica Alleges Theft"; "Metallica Demands Napster Site Shutdown". What is Metallica's problem? As you probably know, Metallica is a rock band and the band members are upset at a web site by the name of Napster. What is it exactly that Napster does? Well, if you have downloaded any music from the Internet lately, you utilized a musical file format called MP3.<br><font size="-10"><br /></font><font size="-3">Date Published: 12/12/2000<br />Grades: 9-12<br />Source: <a href='http://www.econedlink.org/' target='_blank'>EconEdLink.org</a></font></p><br>]]></resources>
<related>
<concept>3</concept>
<concept>8</concept>
</related>
<quiz>1</quiz>
</concept>
<concept>
<id>60</id>
<name>Real vs. Nominal</name>
<category>1</category>
<definition><![CDATA[<p>An economic variable expressed in <b>nominal</b> terms uses the <a href="event:function=defineGlossaryTerm,Price">prices</a> that applied at that particular time. For example, the nominal GDP of the U.S. economy in 2008 was $14.3 trillion; the average price of a gallon of gasoline in the United States in 2008 was $3.23 per gallon; and the <a href="event:function=defineGlossaryTerm,Interest Rate">interest rate</a> charged by <a href="event:function=defineGlossaryTerm,Bank">banks</a> to their most trustworthy <a href="event:function=defineGlossaryTerm,Borrower">borrowers</a> in 2008 was 5.2 percent.</p><br><p>In contrast, an economic variable expressed in <b>real</b> terms is adjusted for the effects of <a href="event:function=defineGlossaryTerm,Inflation">inflation</a>. Adjusting economic variables from nominal to real terms is commonly done to facilitate comparisons between different points in time. For example, the U.S. GDP in 1990 was $5.8 trillion. The nominal U.S. GDP in 1990 is expressed in the dollars prevailing in 1990, while the nominal U.S. GDP in 2008 is expressed in the dollars prevailing in 2008. But because of inflation between 1990 and 2008, a dollar was worth less in 2008 than in 1990. If the nominal U.S. GDP in 1990 was expressed in terms of the dollars in 2008, it would need to be increased by 64 percent to account for inflation--from $5.8 trillion to $9.5 trillion. Thus, the real increase in GDP from 1990 to 2008 is a rise from $9.5 trillion (the 1990 GDP expressed in year 2008 dollars) to $14.3 trillion (the 2008 GDP expressed in year 2008 dollars).</p><br><p>Similarly, the price of gasoline in 1990 was about $1.20 per gallon. With 64 percent inflation between 1990 and 2008, the nominal price of gasoline in 1990, expressed in year 2008 dollars, would be $1.97 ($1.20 x 1.64).</p><br><p>To calculate a real interest rate, after adjusting for inflation, use the formula: real interest rate = nominal interest rate - rate of inflation. In 2008, for example, the rate of inflation in the U.S. economy was 3.8 percent. Thus, the real interest rate was 5.2 percent - 3.8 percent = 1.4 percent. A loan is repaid in the future, so if inflation exists, the dollars used to repay the loan are worth less than the dollars that were originally loaned out. When deflation occurs the dollars used to repay the loan are worth more than the dollars that were originally loaned out. Economies with high rates of inflation will also have high nominal interest rates, because <a href="event:function=defineGlossaryTerm,Lender">lenders</a> wish to receive a positive real interest rate, and thus the nominal interest rate must be higher than the rate of inflation that they expect to occur.</p>]]></definition>
<lessons><![CDATA[<p>Below are <b>featured</b> lessons for teaching Real vs. Nominal.</p><br><p class="tipHeading">High School Lessons</p><p>--------------------------------------------------------------------</p><p><a href="event:function=viewLesson,68105"><b>Lesson 2 - How Economic Performance From 2007-2009 Compares to Other Periods in U.S. History</b></a><br><a href="event:function=viewPublication,140">Teaching Financial Crises</a></p><br><p class="smaller_text">The students examine information and data about six recessions in the United States. In small groups, they use the information to make short presentations about the recessions, highlighting data on economic performance during the time periods, and...</p><br><p>--------------------------------------------------------------------</p><p><a href="event:function=viewLesson,68034"><b>Lesson 8 - Economic Misery and Presidential Elections</b></a><br><a href="event:function=viewPublication,118">Focus: Understanding Economics in Civics and Government</a></p><br><p class="smaller_text">The students examine economic data in order to predict the results of presidential elections.</p><br><p>--------------------------------------------------------------------</p><p><a href="event:function=viewLesson,67759"><b>Lesson 33: When the Boys Came Marching Home</b></a><br><a href="event:function=viewPublication,105">Focus: Understanding Economics in U.S. History</a></p><br><p class="smaller_text">The students are presented with a mystery about economic conditions in the United States after World War I and World War II. They solve the mystery in groups, using clues about the state of aggregate demand after each war.</p><br><p>--------------------------------------------------------------------</p><p><a href="event:function=viewLesson,65720"><b>Lesson 4: Klips And Kupons</b></a><br><a href="event:function=viewPublication,63">Economies in Transition: Command to Market</a></p><br><p class="smaller_text">The students participate in the Klips and Kupons simulation. During the simulation, they discover how a change in the money supply can cause changes in the price level. They formalize this discovery by relating the equation of exchange to their ...</p><br> <p>--------------------------------------------------------------------</p><p><a href="event:function=viewLesson,602"><b><font color="#CC6666">Online Lesson:</font> Closing the Gap</b></a><br><a href='http://www.econedlink.org/' target='_blank'>EconEdLink.org</a></p><br><p class="smaller_text">The students learn what GDP is. They will learn different measures of GDP as well as how GDP per capita can be used to compare countries. They will also calculate GDP per capita and learn how poorer countries can converge, or close the gap, with r...</p><br>]]></lessons>
<tips><![CDATA[<p class="tipHeading">Tip #1</p><p>The students must understand the difference between real and nominal values in order to make historical comparisons. Real monetary values are obtained by adjusting or deflating nominal values with an appropriate index of prices. Discuss real interest rates, real GDP or even real teacher salaries. Take the nominal price of an item in the 1930s, and compare it to the nominal price today. Then adjust for inflation, and the real price today may not be too high.</p><br><p class="tipHeading">Tip #2</p><p>Karl Ochi, economics teacher at Washington High School in San Francisco, uses a bathroom scale to explain the difference between real and nominal values: Prior to the activity secretly set a bathroom scale to some weight above zero and then cover the figures. Ask the students to state their weights and then weigh themselves on the scale. Uncover the figures, and the students find they weigh more than they expected. After the students step off the scale, secretly reset the scale to start below zero, and then the students "lose weight" and weigh less than they did before. Did they lose "scale" (nominal) weight, or did they actually become lighter (real)? In order to "deflate" the scale's figures, we need to know the scale's "error" (rate of inflation). Hold a discussion to prompt the students to recognize the concept of "scale error" (inflation/deflation) as well as the idea of the "deflator," which factors out scale error.</p><br>]]></tips>
<resources><![CDATA[<p><b>Interactive tools:</b><br /></p><p><font color="#CC6666">Video</font> <a href='http://www.econedlink.org/i207' target='_blank'>Real vs. Nominal</a></p><p>This video teaches the concept of Real GDP vs. Nominal GDP.<br><font size="-10"><br /></font><font size="-3">Date Published: 07/12/2012<br>Grades: 6-8, 9-12<br />Source: <a href='http://www.econedlink.org/' target='_blank'>EconEdLink.org</a></font></p><br><p><font color="#CC6666">Video</font> <a href='http://www.econedlink.org/i204' target='_blank'>Gross Domestic Product (GDP)</a></p><p>This video teaches the concept of Gross Domestic Product (GDP). GDP is the total market value of all final goods and services produced within a country, usually measured over a year.<br><font size="-10"><br /></font><font size="-3">Date Published: 07/12/2012<br>Grades: 6-8, 9-12<br />Source: <a href='http://www.econedlink.org/' target='_blank'>EconEdLink.org</a></font></p><br><p><font color="#CC6666">Video</font> <a href='http://www.econedlink.org/i205' target='_blank'>Inflation</a></p><p>This video teaches the concept of Inflation, which is an increase in the average price level in the economy.<br><font size="-10"><br /></font><font size="-3">Date Published: 07/12/2012<br>Grades: 6-8, 9-12<br />Source: <a href='http://www.econedlink.org/' target='_blank'>EconEdLink.org</a></font></p><br><p><font color="#CC6666">Video</font> <a href='http://www.econedlink.org/i14' target='_blank'>Making Sen$e with Paul Solman: Some Find Silver Lining in Dark Economic Cloud</a></p><p>Paul Solman reports on the unexpected positive side effects the economic downturn has had for some Americans.<br><font size="-10"><br /></font><font size="-3">Date Published: 02/20/2009<br>Grades: 9-12<br />Source: <a href='http://www.econedlink.org/' target='_blank'>EconEdLink.org</a></font></p><br><p><font color="#CC6666">Video</font> <a href='http://www.econedlink.org/i229' target='_blank'>Financial Markets</a></p><p>This video teaches the concept of Financial Markets. Financial markets are those markets that exist for buying and selling financial assets. The most important financial assets for individual investors are bonds, stocks and mutual funds.<br><font size="-10"><br /></font><font size="-3">Date Published: 07/12/2012<br>Grades: 6-8, 9-12<br />Source: <a href='http://www.econedlink.org/' target='_blank'>EconEdLink.org</a></font></p><br><p>-------------------------------------</p><p><b>Lessons:</b></p><br><p><a href='http://www.econedlink.org/e602' target='_blank'>Closing the Gap</a></p><p>The students learn what GDP is. They will learn different measures of GDP as well as how GDP per capita can be used to compare countries. They will also calculate GDP per capita and learn how poorer countries can converge, or close the gap, with richer countries.<br><font size="-10"><br /></font><font size="-3">Date Published: 10/27/2005<br />Grades: 9-12<br />Source: <a href='http://www.econedlink.org/' target='_blank'>EconEdLink.org</a></font></p><br><p><a href='http://www.econedlink.org/e1010' target='_blank'>Avatar, King of the Box Office?</a></p><p>On January 26, 2010, the film Avatar officially topped Titanic as the top-grossing film of all-time at the box office. However, the following day, Forbes.com published an article entitled Is Avatar Really King of the Box Office? The article explains how using calculations such as the Consumer Price Index (CPI), one can show how the film Gone With the Wind has grossed more when the value of the box office receipts are adjusted for inflation.<br><font size="-10"><br /></font><font size="-3">Date Published: 10/27/2011<br />Grades: 9-12<br />Source: <a href='http://www.econedlink.org/' target='_blank'>EconEdLink.org</a></font></p><br>]]></resources>
<related>
<concept>18</concept>
<concept>14</concept>
<concept>65</concept>
</related>
<quiz>1</quiz>
</concept>
<concept>
<id>49</id>
<name>Risk and Return</name>
<category>4</category>
<definition><![CDATA[<p><b>Risk</b> describes a situation in which the outcome is uncertain and a range of results, potentially both good and bad, is possible. The greater the range of possible outcomes, the greater the <a href="event:function=defineGlossaryTerm,Risk">risk</a>. For example, imagine two <a href="event:function=defineGlossaryTerm,Investment">investment</a> strategies, both with the same cost. The first strategy has a one-third chance of making <a href="event:function=defineGlossaryTerm,Profit">profits</a> of $9 million, a one-third chance of making profits of $10 million and a one-third chance of making profits of $11 million. The second strategy has a one-third chance of making losses of $5 million, a one-third chance of making profits of $10 million and a one-third chance of making profits of $25 million. In both cases, the average or expected outcome is $10 million. But the first strategy has less risk, because the range of possible outcomes is grouped more closely together. </p> <br><p>The <b>return</b> of an investment is calculated as the income or profit generated by that investment divided by the original cost of the investment. The <a href="event:function=defineGlossaryTerm,Rate of Return">rate of return</a> is usually expressed as a percentage over a year. If you put money in a <a href="event:function=defineGlossaryTerm,Bank Account">bank account</a> and receive a 3 percent rate of <a href="event:function=defineGlossaryTerm,Interest">interest</a>, then the return is 3 percent. A more complex example would be if you invest money in a <a href="event:function=defineGlossaryTerm,Stock">stock</a> which pays a <a href="event:function=defineGlossaryTerm,Dividend">dividend</a> and also increases in value per share. The total increase in value, including both dividend and the rise in the share price, would be counted in the rate of return. <a href="event:function=defineGlossaryTerm,Firms">Firms</a> need to make projections about rate of return when they make decisions about building a new plant, buying a large piece of equipment or launching a new product. They calculate the additional profit that they expect to earn from the <a href="event:function=defineGlossaryTerm,Business">business</a> decision, divided by the cost of that decision. </p> <br><p>There is a strong relationship between risk and <a href="event:function=defineGlossaryTerm,Return">return</a>. Generally, the greater the risk, the higher the potential return. If an investment seems too good to be true, it probably is.</p>]]></definition>
<lessons><![CDATA[<p>Below are <b>featured</b> lessons for teaching Risk and Return.</p><br><p class="tipHeading">High School Lessons</p><p>--------------------------------------------------------------------</p><p><a href="event:function=viewLesson,68307"><b>Theme 5: Lesson 21 - There Is No Free Lunch in Investing</b></a><br><a href="event:function=viewPublication,138">Financial Fitness for Life: 9-12 - Teacher Guide</a></p><br><p class="smaller_text">Risk is inherent in all investments. Some risks are ones investors cannot control. Other risks can be managed. The key is to develop a risk-reward ratio with which you are comfortable. The greater the risk, the higher the potential reward. Given t...</p><br><p>--------------------------------------------------------------------</p><p><a href="event:function=viewLesson,68110"><b>Lesson 7 - The Instruments and Institutions of Modern Financial Markets</b></a><br><a href="event:function=viewPublication,140">Teaching Financial Crises</a></p><br><p class="smaller_text">Students work in small groups to make flash cards to display terms commonly used in modern financial markets. Each group of students begins by learning one group of terms. The students pass their flash cards from group to group until everyone has ...</p><br><p>--------------------------------------------------------------------</p><p><a href="event:function=viewLesson,65740"><b>Lesson 1 - Why Insurance and How Does It Work?</b></a><br><a href="event:function=viewPublication,100">Virtual Economics: Insurance Lessons</a></p><br><p class="smaller_text">This lesson uses readings and group work to describe the risks that are a part of everyone's life. It then elaborates on five ways to handle risk. Two of these ways are to share and transfer risk, which is the purpose of insurance.</p><br><p>--------------------------------------------------------------------</p><p><a href="event:function=viewLesson,62512"><b>Lesson 7- The Great Tulip Boom</b></a><br><a href="event:function=viewPublication,70">World History: Focus on Economics</a></p><br><p class="smaller_text">The teacher displays a transparency comparing the prices of many goods in the 1600s in the Netherlands to prices paid for rare tulip bulbs during the Great Tulip Boom of the 1630s. Students perform a simulation of the boom and write a short essay...</p><br> <p class="tipHeading">Middle School Lessons</p><p>--------------------------------------------------------------------</p><p><a href="event:function=viewLesson,476"><b><font color="#CC6666">Online Lesson:</font> I Can Be an Entrepreneur</b></a><br><a href='http://www.econedlink.org/' target='_blank'>EconEdLink.org</a></p><br><p class="smaller_text">Learners are given advice on how they can earn extra money by becoming an entrepreneur. After investigating several web pages that offer examples of what other people their age have done to earn money, students identify three money-making ideas fo...</p><br>]]></lessons>
<tips><![CDATA[<p class="tipHeading">Tip #1</p><p>Drive home the risk and return trade-off by asking the students to evaluate the old investment cliché, "If an investment seems too good to be true, it probably is." What does this mean in terms of risk and return?</p><br><p class="tipHeading">Tip #2</p><p>One way to illustrate the trade-off between risk and return is to develop a pyramid of risk and return illustrating that the higher the return, the greater the risk. The pyramid would look like this.<p><img src="risk_graphic.swf" height="265" width="445"></p><br><br><br><br><br><br><br><br><br><br><br><br><br><br></p><br><p class="tipHeading">Tip #3</p><p>A goal of personal finance education is that students should recognize and reduce investment risk but not eliminate it. Successful investing involves taking prudent risks. For example, the stock market is more volatile than the U.S. government bond market. However, stocks have had a much higher rate of return over the long term.</p><br>]]></tips>
<resources><![CDATA[<p><b>Interactive tools:</b><br /></p><p><font color="#CC6666">Flash</font> <a href='http://www.econedlink.org/i107' target='_blank'>Gen i Revolution - Mission 6: Risk and Return</a></p><p>This interactive tool is a part of the online personal finance game, Gen i Revolution. This is one of the fifteen "Missions" available within the online game. This Mission takes about 30 minutes to complete. To sign up to play the game, you'll nee...<br><font size="-10"><br /></font><font size="-3">Date Published: 08/14/2010<br>Grades: 6-8, 9-12<br />Source: <a href='http://www.econedlink.org/' target='_blank'>EconEdLink.org</a></font></p><br><p><font color="#CC6666">Video</font> <a href='http://www.econedlink.org/i233' target='_blank'>Risk and Return</a></p><p>This video teaches the concepts of Risk and Return. Risk describes a situation in which the outcome is uncertain and a range of results, potentially both good and bad, is possible. The return of an investment is calculated as the income or profit ...<br><font size="-10"><br /></font><font size="-3">Date Published: 07/12/2012<br>Grades: 6-8, 9-12<br />Source: <a href='http://www.econedlink.org/' target='_blank'>EconEdLink.org</a></font></p><br><p><font color="#CC6666">Video</font> <a href='http://www.econedlink.org/i241' target='_blank'>Making Sen$e with Paul Solman: Fictional Thriller Tackles Dangers of High-Frequency Trading CONVERSATION</a></p><p>Part of his series on Making $ense of financial news, economics correspondent Paul Solman spoke with author Robert Harris whose fictional take on Wall Street, "The Fear Index," stresses the dangers of algorithm-driven, high-frequency trading.<br><font size="-10"><br /></font><font size="-3">Date Published: 03/15/2012<br>Grades: 9-12<br />Source: <a href='http://www.econedlink.org/' target='_blank'>EconEdLink.org</a></font></p><br><p><font color="#CC6666">Video</font> <a href='http://www.econedlink.org/i263' target='_blank'>Making Sen$e of Health Care: Competing Claims on Campaign Trail About Reform</a></p><p>Paul Solman compares and contrasts "Obamacare" policy with health care reform proposals from Mitt Romney. Economists on both sides of the political debate discuss increasing efficiency, technological innovation, market competition and vouchers.<br><font size="-10"><br /></font><font size="-3">Date Published: 09/11/2012<br>Source: <a href='http://www.econedlink.org/' target='_blank'>EconEdLink.org</a></font></p><br><p><font color="#CC6666">Video</font> <a href='http://www.econedlink.org/i260' target='_blank'>Making Sen$e with Paul Solman: Making Sen$e of Bailouts: Why the U.S. Government Bought 'Troubled Assets'</a></p><p><br><font size="-10"><br /></font><font size="-3">Date Published: 08/02/2012<br>Grades: 9-12<br />Source: <a href='http://www.econedlink.org/' target='_blank'>EconEdLink.org</a></font></p><br><p>-------------------------------------</p><p><b>Lessons:</b></p><br><p><a href='http://www.econedlink.org/e1100' target='_blank'>Pop Goes the Housing Bubble</a></p><p>In this lesson, students will learn about a speculative bubble within the context of the U.S. real estate market.<br><font size="-10"><br /></font><font size="-3">Date Published: 03/11/2013<br />Grades: 9-12<br />Source: <a href='http://www.econedlink.org/' target='_blank'>EconEdLink.org</a></font></p><br><p><a href='http://www.econedlink.org/e1074' target='_blank'>Spotlighting Entrepreneurs: A Technology "iCon"</a></p><p>What better way to address Common Core standards in Reading Informational Text than by meeting a gentleman that changed the world of technology!<br><font size="-10"><br /></font><font size="-3">Date Published: 03/11/2013<br />Grades: 3-5<br />Source: <a href='http://www.econedlink.org/' target='_blank'>EconEdLink.org</a></font></p><br><p><a href='http://www.econedlink.org/e1069' target='_blank'>Spotlighting Entrepreneurs: The Sweet Success of Milton Hershey</a></p><p>Looking for a lesson that ties Common Core Standards in Reading Informational Text with Economics? This lesson spotlights the life of Milton S. Hershey and allows students to learn about the risks and rewards of entrepreneurship through a biographical sketch of one who experienced many bitter disappointments and sweet successes.<br><font size="-10"><br /></font><font size="-3">Date Published: 07/23/2012<br />Grades: 3-5<br />Source: <a href='http://www.econedlink.org/' target='_blank'>EconEdLink.org</a></font></p><br><p><a href='http://www.econedlink.org/e553' target='_blank'>Collecting for Fun . . . and Profit?</a></p><p>Art, baseball cards, coins, comic books, dolls, jewelry and stamps are just a few examples of the many things people collect. While some people collect for fun — others hope to profit. In this lesson, students explore how supply and demand influence the price of collectibles. They also evaluate speculation in collectibles as an investment option. They learn that collectibles are one of the riskiest ways people can invest their money.<br><font size="-10"><br /></font><font size="-3">Date Published: 12/27/2004<br />Grades: 6-8, 9-12<br />Source: <a href='http://www.econedlink.org/' target='_blank'>EconEdLink.org</a></font></p><br><p><a href='http://www.econedlink.org/e543' target='_blank'>Business Ownership: The Franchise Option</a></p><p>Students explore an alternative to starting a business from scratch – investing in a franchise. They begin by considering the pros and cons of a franchise and whether this form of business is an option that would fit their personality and needs. Students then research and analyze franchise opportunities, ultimately selecting one that they think they might be able to successfully operate in their own community. While making their choice, students consider a variety of factors including their personal interests and abilities, the reputation of the product or service, the franchisor’s ability and willingness to assist the franchisee, and market factors such as consumer demand and anticipated competition.<br><font size="-10"><br /></font><font size="-3">Date Published: 04/21/2004<br />Grades: 9-12<br />Source: <a href='http://www.econedlink.org/' target='_blank'>EconEdLink.org</a></font></p><br>]]></resources>
<related>
<concept>64</concept>
<concept>47</concept>
</related>
<quiz>1</quiz>
</concept>
<concept>
<id>24</id>
<name>Roles of Government</name>
<category>2</category>
<definition><![CDATA[<p><a href="event:function=defineGlossaryTerm,Markets">Markets</a> perform well in providing most <a href="event:function=defineGlossaryTerm,Goods">goods</a> and <a href="event:function=defineGlossaryTerm,Services">services</a> of everyday life: groceries, restaurant meals, clothing, movies and cars. Nevertheless, there is a role for government in areas where markets fail or are inefficient. Some <b><a href="event:function=defineGlossaryTerm,Role of Government">roles of government</a></b> include protecting the environment, helping the poor and providing national defense. In these cases, there is a role for government to provide <a href="event:function=defineGlossaryTerm,Economic Security">economic security</a> and foster <a href="event:function=defineGlossaryTerm,Competition">competition</a>. Governments also provide <a href="event:function=defineGlossaryTerm,Public Goods">public goods</a>. Public goods are those that cannot easily be restricted to those who pay for them. For most public goods, consumption by one person does not reduce the amount of the good available to others. Political opinions differ about how extensive the role of government should be in managing the economy. But even those who favor a primarily market-oriented economy usually concede that markets also need a backdrop of a rule of law to function well, in which the government enforces contracts and protects <a href="event:function=defineGlossaryTerm,Property Rights">property rights</a>. The paradox of good government is that it must be strong enough to perform its appropriate roles, but weak enough that it does not intervene excessively in people's lives. Although there is a role for government, we cannot assume that it will perform that role well. There are and have been policies that hurt the poor, harm the environment and protect <a href="event:function=defineGlossaryTerm,Monopoly">monopolies</a>.</p>]]></definition>
<lessons><![CDATA[<p>Below are <b>featured</b> lessons for teaching Roles of Government.</p><br><p class="tipHeading">High School Lessons</p><p>--------------------------------------------------------------------</p><p><a href="event:function=viewLesson,68111"><b>Lesson 8 - Understanding Financial Markets, 2007-2009</b></a><br><a href="event:function=viewPublication,140">Teaching Financial Crises</a></p><br><p class="smaller_text">This lesson pulls together the events in financial markets from 2007 to 2009 by examining the persons and financial institutions that played key roles in the crisis, including why it occurred, who was affected, and the aftermath. How better to und...</p><br><p>--------------------------------------------------------------------</p><p><a href="event:function=viewLesson,68037"><b>Lesson 11 - How Should Governments Structure the Tax System?</b></a><br><a href="event:function=viewPublication,118">Focus: Understanding Economics in Civics and Government</a></p><br><p class="smaller_text">In a group activity, the students decide on a method of taxation for a hypothetical country. After they have developed a tax system, they discuss their reasons for designing the system they have created. They learn whether their system is progress...</p><br><p>--------------------------------------------------------------------</p><p><a href="event:function=viewLesson,68036"><b>Lesson 10 - An Economic Analysis of Health Care Policy</b></a><br><a href="event:function=viewPublication,118">Focus: Understanding Economics in Civics and Government</a></p><br><p class="smaller_text">The students discuss the strengths and weaknesses of health care in the United States. As "members" of the Surgeon General's Task Force on the Economics of Health Care Policies, they consider how the laws of supply and demand can be used to analyz...</p><br><p>--------------------------------------------------------------------</p><p><a href="event:function=viewLesson,68030"><b>Lesson 4 - What Are the Economic Functions of Government?</b></a><br><a href="event:function=viewPublication,118">Focus: Understanding Economics in Civics and Government</a></p><br><p class="smaller_text">The teacher introduces six economic functions of government in a brief lecture. In a guided practice activity, the students classify newspaper headlines according to the six functions. A brief reading introduces "liberal" and "conservative" views ...</p><br><p>--------------------------------------------------------------------</p><p><a href="event:function=viewLesson,67755"><b>Lesson 29: Who Should Make the Food Safe?</b></a><br><a href="event:function=viewPublication,105">Focus: Understanding Economics in U.S. History</a></p><br><p class="smaller_text">The students examine issues related to food safety. They role-play, participate in a class discussion and analyze a graph depicting changes
in a market to gain insight into ways in which government regulations affect the behavior of producers. In ...</p><br><p>--------------------------------------------------------------------</p><p><a href="event:function=viewLesson,60257"><b>Lesson 7: Public Goods and Externalities</b></a><br><a href="event:function=viewPublication,39">Focus: Institutions and Markets</a></p><br><p class="smaller_text">This lesson gives students an opportunity to identify the nature of public and private goods, classify them according to the characteristics of rivalry and excludability, experience the impact of free riders and other external benefits and costs, ...</p><br><p>--------------------------------------------------------------------</p><p><a href="event:function=viewLesson,62483"><b>Lesson 11: The Lancaster Landfill</b></a><br><a href="event:function=viewPublication,72">Geography: Focus on Economics</a></p><br><p class="smaller_text">Students participate in a simulated town meeting called to consider proposed solutions to the problem of groundwater contamination. Hazardous waste accumulated in a landfill over many years is creating the problem. The landfill is no longer in u...</p><br> <p>--------------------------------------------------------------------</p><p><a href="event:function=viewLesson,748"><b><font color="#CC6666">Online Lesson:</font> Tax Time Scavenger Hunt</b></a><br><a href='http://www.econedlink.org/' target='_blank'>EconEdLink.org</a></p><br><p class="smaller_text">Income taxes can be confusing, but there are a lot of online resources to help us understand them! This lesson takes students through four useful sites, asking them to look for specific information that will broaden their understanding of how inc...</p><br><p>--------------------------------------------------------------------</p><p><a href="event:function=viewLesson,759"><b><font color="#CC6666">Online Lesson:</font> Marketplace: School Competition</b></a><br><a href='http://www.econedlink.org/' target='_blank'>EconEdLink.org</a></p><br><p class="smaller_text">In June 2002, the Supreme Court ruled that Cleveland's system of giving students vouchers to attend private or religious schools did not violate the constitutional separation of church and state. In this lesson, students listen to an audio file ab...</p><br><p>--------------------------------------------------------------------</p><p><a href="event:function=viewLesson,628"><b><font color="#CC6666">Online Lesson:</font> History of monopolies in the United States.</b></a><br><a href='http://www.econedlink.org/' target='_blank'>EconEdLink.org</a></p><br><p class="smaller_text">Monopolies in the United States have existed in many forms. When a business dominates a market, its market power makes it a monopoly. How these businesses use their market power will determine the legality of the monopoly.</p><br><p>--------------------------------------------------------------------</p><p><a href="event:function=viewLesson,542"><b><font color="#CC6666">Online Lesson:</font> Worker Safety - The Triangle Fire Legacy</b></a><br><a href='http://www.econedlink.org/' target='_blank'>EconEdLink.org</a></p><br><p class="smaller_text">The Triangle Shirtwaist Fire of 1911 was a turning point for employee health and safety protections in the U.S. Students investigate the Triangle tragedy and how its impact is still felt today. Students identify eerie parallels between the ...</p><br><p>--------------------------------------------------------------------</p><p><a href="event:function=viewLesson,522"><b><font color="#CC6666">Online Lesson:</font> Guess Who's Coming to Dinner</b></a><br><a href='http://www.econedlink.org/' target='_blank'>EconEdLink.org</a></p><br><p class="smaller_text">This lesson introduces regulation and information as two tools used by government to promote fair competition and complete information in a market economy. Using the 1906 Pure Food and Drugs Act as a case study, students explore the reasons b...</p><br><p class="tipHeading">Middle School Lessons</p><p>--------------------------------------------------------------------</p><p><a href="event:function=viewLesson,68240"><b>Theme 3: Lesson 9 - What Taxes Affect You?</b></a><br><a href="event:function=viewPublication,136">Financial Fitness for Life: Grades 6-8 - Teacher Guide</a></p><br><p class="smaller_text">This lesson focuses on taxes and the uses governments make of tax revenue. Tax revenue pays for public goods and services: roads, schools, court houses, police and fire protection, parks, national defense, and so on. Taxes are also used to fund tr...</p><br><p>--------------------------------------------------------------------</p><p><a href="event:function=viewLesson,67873"><b>Lesson 4 - A Taxing Situation</b></a><br><a href="event:function=viewPublication,115">Focus: Economics - Grades 3-5</a></p><br><p class="smaller_text">In this two-part lesson, the students learn the definition of income tax, sales tax and property tax, as well as a simple formula to determine the amount of each tax. In addition, the students conduct a survey and participate in an activity to ca...</p><br><p>--------------------------------------------------------------------</p><p><a href="event:function=viewLesson,67872"><b>Lesson 3 - We've Got Goods</b></a><br><a href="event:function=viewPublication,115">Focus: Economics - Grades 3-5</a></p><br><p class="smaller_text">In this lesson, the students read about an elementary student and identify the goods and services she uses in a day. After categorizing goods and services as those that are privately produced or that are provided by government, the students work ...</p><br><p>--------------------------------------------------------------------</p><p><a href="event:function=viewLesson,15857"><b>Lesson 12 - Charting a Budget</b></a><br><a href="event:function=viewPublication,3">Mathematics & Economics: Connections for Life - 6-8</a></p><br><p class="smaller_text">In this lesson, students learn what a budget is. They construct a pie chart to show the distribution of expenses in a budget. They learn about payroll deductions and determine the impact that payroll deductions have on a budget. Finally, they lear...</p><br><p>--------------------------------------------------------------------</p><p><a href="event:function=viewLesson,62644"><b>Lesson 14 - No Free Lunch</b></a><br><a href="event:function=viewPublication,49">Focus: Middle School Economics</a></p><br><p class="smaller_text">Students use a decision tree to analyze a budget problem at a public school</p><br><p>--------------------------------------------------------------------</p><p><a href="event:function=viewLesson,62640"><b>Lesson 10 - Where Does the Money Go?</b></a><br><a href="event:function=viewPublication,49">Focus: Middle School Economics</a></p><br><p class="smaller_text">Students look at the categories of federal spending, discuss them, and calculate the percentage of spending in each category.</p><br> <p>--------------------------------------------------------------------</p><p><a href="event:function=viewLesson,859"><b><font color="#CC6666">Online Lesson:</font> The Effects of the Recession</b></a><br><a href='http://www.econedlink.org/' target='_blank'>EconEdLink.org</a></p><br><p class="smaller_text">The students learn how a recession affects our economy, and how it might affect them personally.They examine the role the federal government has played in dealing with the current recession. They analyze their thoughts about what role the federal ...</p><br><p>--------------------------------------------------------------------</p><p><a href="event:function=viewLesson,841"><b><font color="#CC6666">Online Lesson:</font> Competition Works in Our Flavor</b></a><br><a href='http://www.econedlink.org/' target='_blank'>EconEdLink.org</a></p><br><p class="smaller_text">Competition provides benefits for consumers. First, more competition means consumers have more choices of goods and services. Second, when more firms are offering goods and services, competition often leads to lower prices.</p><br><p>--------------------------------------------------------------------</p><p><a href="event:function=viewLesson,462"><b><font color="#CC6666">Online Lesson:</font> The Mystery of is it Mine or Ours?</b></a><br><a href='http://www.econedlink.org/' target='_blank'>EconEdLink.org</a></p><br><p class="smaller_text">Did you ride to school on a road today? Yesterday did you skate in a public park? Maybe Mom or Dad traveled home from one of your ball games on their bicycles under a string of street lights? How did the road, the park or the street lights ge...</p><br><p>--------------------------------------------------------------------</p><p><a href="event:function=viewLesson,356"><b><font color="#CC6666">Online Lesson:</font> Taxation without Representation?</b></a><br><a href='http://www.econedlink.org/' target='_blank'>EconEdLink.org</a></p><br><p class="smaller_text">This lesson will take students through the series of tax acts that were enacted by the British government and disputed by the original 13 colonies of America prior to the American Revolution. Students will discuss the concept of government-pr...</p><br><p class="tipHeading">Elementary Lessons</p><p>--------------------------------------------------------------------</p><p><a href="event:function=viewLesson,68166"><b>Theme 1: Lesson 3 - People Pay Taxes</b></a><br><a href="event:function=viewPublication,134">Financial Fitness for Life: Grades 3-5 - Teacher Guide</a></p><br><p class="smaller_text">The students participate in an activity designed to help them understand when and why people pay taxes. They learn about income and the differences between gross and net income. They learn that we pay taxes on income and that governments use tax r...</p><br><p>--------------------------------------------------------------------</p><p><a href="event:function=viewLesson,67945"><b>Lesson 24: Night of the Twister</b></a><br><a href="event:function=viewPublication,116">Teaching Economics Using Children's Literature</a></p><br><p class="smaller_text">This story, based on a real event, tells how the Hatch family and the people of Grand Island, Nebraska, survive a night of terror when their town is devastated by several tornadoes. Together they not only live through the tragedy but rebuild thei...</p><br><p>--------------------------------------------------------------------</p><p><a href="event:function=viewLesson,67930"><b>Lesson 9: Ant Cities</b></a><br><a href="event:function=viewPublication,116">Teaching Economics Using Children's Literature</a></p><br><p class="smaller_text">This is a nonfiction story about different kinds of ants and how they live and work together. Ants live in colonies, and all ants have particular jobs to do, much like workers in our cities. Working together, ants keep their "cities" growing and...</p><br><p>--------------------------------------------------------------------</p><p><a href="event:function=viewLesson,62359"><b>Lesson 14: If This, Then That</b></a><br><a href="event:function=viewPublication,59">Master Curriculum Guides in Economics: Teaching Strategies - 5-6</a></p><br><p class="smaller_text">In the U.S. economy, markets function to establish prices and quantities for goods, services, and resources. Through this price system, scarce resources are allocated to the production of goods and services most desired by consumers who are able ...</p><br><p>--------------------------------------------------------------------</p><p><a href="event:function=viewLesson,62322"><b>Lesson 10: A Taxing Situation</b></a><br><a href="event:function=viewPublication,58">Master Curriculum Guides in Economics: Teaching Strategies - 3-4</a></p><br><p class="smaller_text">Some goods and services are provided by government. There are over 87,000 different governments in the Unites States, ranging from the federal government, to state governments, to many types of local governments (such as county, city, and townshi...</p><br> <p>--------------------------------------------------------------------</p><p><a href="event:function=viewLesson,665"><b><font color="#CC6666">Online Lesson:</font> Cowboy Bob Builds a Community</b></a><br><a href='http://www.econedlink.org/' target='_blank'>EconEdLink.org</a></p><br><p class="smaller_text">A cowboy rides into a ghost town and decides that it needs to be rebuilt. Students will select the necessary things that a town needs in order for it to function and grow.</p><br><p>--------------------------------------------------------------------</p><p><a href="event:function=viewLesson,385"><b><font color="#CC6666">Online Lesson:</font> Buy A Bond, James!: A Lesson on U.S. Savings Bonds</b></a><br><a href='http://www.econedlink.org/' target='_blank'>EconEdLink.org</a></p><br><p class="smaller_text">Students will find out what savings are and will be introduced to U.S. Savings Bonds.</p><br><p>--------------------------------------------------------------------</p><p><a href="event:function=viewLesson,372"><b><font color="#CC6666">Online Lesson:</font> Clean Land - Thanks to US!</b></a><br><a href='http://www.econedlink.org/' target='_blank'>EconEdLink.org</a></p><br><p class="smaller_text">In this lesson about the EPA, students will find out that their government pays for goods and services by taxing people and companies.</p><br><p>--------------------------------------------------------------------</p><p><a href="event:function=viewLesson,370"><b><font color="#CC6666">Online Lesson:</font> Tic Tac Taxes!</b></a><br><a href='http://www.econedlink.org/' target='_blank'>EconEdLink.org</a></p><br><p class="smaller_text">This lesson will assist students in identifying various taxes and the services they help governments provide.</p><br><p>--------------------------------------------------------------------</p><p><a href="event:function=viewLesson,281"><b><font color="#CC6666">Online Lesson:</font> Who Pays for City Hall?</b></a><br><a href='http://www.econedlink.org/' target='_blank'>EconEdLink.org</a></p><br><p class="smaller_text">The students take a virtual field trip to City Hall in this kid-friendly site. This beginning civics/economic lesson will introduce your students to city government and teach economics on the way!</p><br><p>--------------------------------------------------------------------</p><p><a href="event:function=viewLesson,198"><b><font color="#CC6666">Online Lesson:</font> Free Ride</b></a><br><a href='http://www.econedlink.org/' target='_blank'>EconEdLink.org</a></p><br><p class="smaller_text">Free Ride helps students identify goods and services provided by the government and evaluate the cost of government provided goods and services.</p><br>]]></lessons>
<tips><![CDATA[<p class="tipHeading">Tip #1</p><p>Students have trouble distinguishing between private and public goods. Identify private goods as "me only" goods, that is, only the person who pays receives benefits from the goods. Identify public goods as "shared" goods meaning that many people can benefit whether or not they paid for the goods.</p><br><p class="tipHeading">Tip #2</p><p>When you discuss public goods with your students, discuss the characteristics of rivalry and excludability. True public goods have neither of these characteristics. They do not exhibit rivalry because when any one person uses a public good, no one else is prohibited from using it as a result. Radio waves, for example, are not suddenly unavailable to you when someone else turns on her car stereo and tunes into a station you desire to listen to; you may both "consume" these radio waves simultaneously. Nor do public goods exhibit excludability. That is, there is no way to prohibit any one person or group of persons from using a public good for any reason. The example of radio waves still applies. No one--not individuals, firms or even the government--can exclude a certain group, teenagers, for example, from consuming radio waves. This example also shows that not all public goods must be produced by government. Radio programs are produced by private businesses because they can sell advertising. Most public goods, however, are produced by government.</p><br><p class="tipHeading">Tip #3</p><p>Students should recognize that taxes are required payments to government. They also need to recognize what taxes are used for. Have younger students draw pictures of businesses, houses and apartment buildings in the community. Have them arrange these pictures on a wall or the floor. Ask them to identify things that are missing from the pictures--roads, sidewalks, police station, fire station, courthouse, city hall and library, for example. Use this to talk about taxes. Have the students use crepe paper to create roads and have them draw pictures of the other things that are missing and add them to their community.</p><br><p class="tipHeading">Tip #4</p><p>Students have difficulty understanding regressive taxes. The problem comes from the fact that although a person's income increases, the percentage of that person's income paid in taxes declines. This is because most regressive taxes are consumption taxes and consumption does not increase in proportion to income. A tax is even more regressive if poor people buy more of the good or service taxed than rich people. Lottery tickets may be the most regressive tax of all.</p><br><p class="tipHeading">Tip #5</p><p>Do the rich pay their "fair share" of income taxes? In a recent year, the top one percent of U.S. taxpayers accounted for 20 percent of total income and paid 38 percent of federal income taxes. Their average tax rate was 23.2 percent of income. The bottom 50 percent of taxpayers earned 12.8 percent of total income and paid 2.7 percent of federal income taxes. Their tax rate was 2.6 percent of income. Give the students these facts and discuss both the distribution of income in the United States and the tax structure. Also discuss other taxes, such as sales and excise taxes, where the poor may pay a higher tax rate. What is "fair"?</p><br>]]></tips>
<resources><![CDATA[<p><b>Interactive tools:</b><br /></p><p><font color="#CC6666">Video</font> <a href='http://www.econedlink.org/i272' target='_blank'>Lawmakers Consider Cutting Tax Deductions to Bring Down the Deficit</a></p><p>While tax breaks are popular, their future may be limited. Congressional leaders are deliberating on how they can increase revenue in order to bring down the deficit, and deductions may be on the chopping block. Paul Solman explores write-offs for...<br><font size="-10"><br /></font><font size="-3">Date Published: 12/10/2012<br>Source: <a href='http://www.econedlink.org/' target='_blank'>EconEdLink.org</a></font></p><br><p><font color="#CC6666">Video</font> <a href='http://www.econedlink.org/i262' target='_blank'>Making Sen$e with Paul Solman: Tax Cuts, Deregulation Among Republican Economic Priorities for 2012 Election</a></p><p>Ahead of the Republican National Convention, Paul Solman goes to Tampa, Fla., to talk to Douglas Holtz-Eakin, former director of the Congressional Budget Office, as well as some conservative business owners about their economic priorities going in...<br><font size="-10"><br /></font><font size="-3">Date Published: 08/24/2012<br>Grades: 9-12<br />Source: <a href='http://www.econedlink.org/' target='_blank'>EconEdLink.org</a></font></p><br><p><font color="#CC6666">Video</font> <a href='http://www.econedlink.org/i257' target='_blank'>Making Sen$e with Paul Solman: 'What Money Can't Buy' and What it Shouldn't Buy</a></p><p>While most of our everyday transactions are driven by the marketplace, are there some things money shouldn't be able to buy -- a spot in line, maybe a human life? As part of his Making Sen$e of financial news series, Paul Solman speaks with Harvar...<br><font size="-10"><br /></font><font size="-3">Date Published: 06/11/2012<br>Grades: 9-12<br />Source: <a href='http://www.econedlink.org/' target='_blank'>EconEdLink.org</a></font></p><br><p><font color="#CC6666">Video</font> <a href='http://www.econedlink.org/i265' target='_blank'>Never Too Young: Personal Finance for Young Learners</a></p><p>This program was developed in response to a growing interest in teaching students about personal finance through settings outside of the traditional school day. The program teaches young students about financial choices, cost‐benefit analysis fo...<br><font size="-10"><br /></font><font size="-3">Date Published: 10/19/2012<br>Grades: K-2, 3-5<br />Source: <a href='http://www.econedlink.org/' target='_blank'>EconEdLink.org</a></font></p><br><p><font color="#CC6666">Video</font> <a href='http://www.econedlink.org/i235' target='_blank'>Making Sen$e with Paul Solman: Taxes: How High Is Too High?</a></p><p>Economics correspondent Paul Solman explores the question of just how high U.S. tax rates should or shouldn't be and examines the relationship between economic activity and tax rates. It's part of his ongoing reporting series, Making Sen$e of fina...<br><font size="-10"><br /></font><font size="-3">Date Published: 01/11/2012<br>Grades: 9-12<br />Source: <a href='http://www.econedlink.org/' target='_blank'>EconEdLink.org</a></font></p><br><p>-------------------------------------</p><p><b>Lessons:</b></p><br><p><a href='http://www.econedlink.org/e370' target='_blank'>Tic Tac Taxes!</a></p><p>This lesson will assist students in identifying various taxes and the services they help governments provide.<br><font size="-10"><br /></font><font size="-3">Date Published: 11/07/2002<br />Grades: 3-5<br />Source: <a href='http://www.econedlink.org/' target='_blank'>EconEdLink.org</a></font></p><br><p><a href='http://www.econedlink.org/e356' target='_blank'>Taxation without Representation?</a></p><p>This lesson will take students through the series of tax acts that were enacted by the British government and disputed by the original 13 colonies of America prior to the American Revolution. Students will discuss the concept of government-provided services in exchange for taxes. Students will explain the specific taxes and the right of the English government to levy them in the context of the oft-used slogan: “No taxation without representation.”<br><font size="-10"><br /></font><font size="-3">Date Published: 08/14/2003<br />Grades: 3-5, 6-8<br />Source: <a href='http://www.econedlink.org/' target='_blank'>EconEdLink.org</a></font></p><br><p><a href='http://www.econedlink.org/e189' target='_blank'>What's the Problem with Digital TV</a></p><p>Students will be introduced to the mandate for digital TV transmission by 2006, consider the implications this mandate will have for the environment (negative externalizes), and evaluate possible solutions to this "problem".<br><font size="-10"><br /></font><font size="-3">Date Published: 11/19/2001<br />Grades: 6-8, 9-12<br />Source: <a href='http://www.econedlink.org/' target='_blank'>EconEdLink.org</a></font></p><br><p><a href='http://www.econedlink.org/e978' target='_blank'>Goods and Services: Some are Private, Some are Not</a></p><p>The role of government is to provide for the common defense, define and protect property rights, and enforce contractual arrangements. Throughout the 20th and early 21st century, government has increased its role in economic life. The role of government has expanded to address so-called market failures and externalities by expanding their regulatory reach to address environmental concerns, monopolistic competition and provide public goods. Governments have also introduced various social programs to provide a social safety net for low-income individuals and senior citizens.<br><font size="-10"><br /></font><font size="-3">Date Published: 01/03/2012<br />Grades: 3-5, 6-8<br />Source: <a href='http://www.econedlink.org/' target='_blank'>EconEdLink.org</a></font></p><br><p><a href='http://www.econedlink.org/e773' target='_blank'>Marketplace: Doing Business in Afghanistan</a></p><p>In May 2002, delegates from governments, international companies, and financial institutions met at a United Nations conference in Tehran to discuss the reconstruction of Afghanistan. Afghanistan's officials say that to create a viable economy and a stable society, the country must recreate basic infrastructures --and it requires foreign investment to do so. But will businesses want to invest in Afghanistan? Correspondent Borzou Daragahi recently traveled to Afghanistan's business centers to see what life is like for the foreign entrepreneur.<br><font size="-10"><br /></font><font size="-3">Date Published: 02/26/2009<br />Grades: 6-8, 9-12<br />Source: <a href='http://www.econedlink.org/' target='_blank'>EconEdLink.org</a></font></p><br>]]></resources>
<related>
<concept>30</concept>
</related>
<quiz>1</quiz>
</concept>
<concept>
<id>47</id>
<name>Saving and Investing</name>
<category>4</category>
<definition><![CDATA[<p>Broadly speaking, an individual has only two <a href="event:function=defineGlossaryTerm,Choice">choices</a> about what to do with (after-tax) <a href="event:function=defineGlossaryTerm,Income">income</a>: spending on current <a href="event:function=defineGlossaryTerm,Consumption">consumption</a> or <b><a href="event:function=defineGlossaryTerm,Savings">saving</a></b> for the future. </p> <br><p>From an individual point of view, saved money typically becomes a form of <b>investing</b>, since the money is put into a <a href="event:function=defineGlossaryTerm,Bank Account">bank account</a>, <a href="event:function=defineGlossaryTerm,Stock">stock</a>, <a href="event:function=defineGlossaryTerm,Bond">bond</a> or <a href="event:function=defineGlossaryTerm,Mutual Fund">mutual fund</a> that pays a <a href="event:function=defineGlossaryTerm,Rate of Return">rate of return</a>. For an individual, <a href="event:function=defineGlossaryTerm,Investing">investing</a> refers to postponing current consumption or rewards to pursue an activity with expectations of greater <a href="event:function=defineGlossaryTerm,Benefit">benefits</a> in the future. Financial investment refers to the decisions by individuals and <a href="event:function=defineGlossaryTerm,Firms">firms</a> to invest money in financial <a href="event:function=defineGlossaryTerm,Asset">assets</a> such as bank accounts, certificates of deposit, stocks, bonds and mutual funds. Financial investment is crucial to accumulating personal wealth. </p> <br><p>Real investment or physical capital investment is the component of <a href="event:function=defineGlossaryTerm,Aggregate Demand (AD)">aggregate demand</a> that refers to the decisions by firms to purchase equipment and physical plant, and also the purchases of new homes by <a href="event:function=defineGlossaryTerm,Consumers">consumers</a>. The amount of real investment is critical to <a href="event:function=defineGlossaryTerm,Economic Growth">economic growth</a>. Financial investment and real investment are connected, but they are not the same. Thus, when you hear a casual reference to "investment," be clear in your own mind on whether it is financial investment or real investment.</p>]]></definition>
<lessons><![CDATA[<p>Below are <b>featured</b> lessons for teaching Saving and Investing.</p><br><p class="tipHeading">High School Lessons</p><p>--------------------------------------------------------------------</p><p><a href="event:function=viewLesson,56533"><b>Section 5: Strategies for Wealth Building</b></a><br><a href="event:function=viewPublication,18">Your Credit Counts Challenge: Trainer's Guide</a></p><br><p class="smaller_text">Participants will understand the concept of net wealth and how the decisions they make can cause their own net wealth to increase or decrease. Participants will explain why an early start in saving and investing increases a household's ability to...</p><br><p>--------------------------------------------------------------------</p><p><a href="event:function=viewLesson,62454"><b>Lesson 14 - Savings and Personal Investments: If You're So Smart, Why Aren't You Rich?</b></a><br><a href="event:function=viewPublication,73">Personal Decision Making: Focus on Economics</a></p><br><p class="smaller_text">Students view a transparency showing the difference between economics definitions and personal finance definitions of the terms capital and investment. They read and discuss a handout listing four basic rules for wise investment decisions. </p><br> <p>--------------------------------------------------------------------</p><p><a href="event:function=viewLesson,707"><b><font color="#CC6666">Online Lesson:</font> The Five Stages of Investing</b></a><br><a href='http://www.econedlink.org/' target='_blank'>EconEdLink.org</a></p><br><p class="smaller_text">The practice of saving and investing is definitely a good thing, but there are many ways to save and invest. In thinking about the options, it is important to consider the degree of risk involved and the potential for return. Typically, the highe...</p><br><p>--------------------------------------------------------------------</p><p><a href="event:function=viewLesson,719"><b><font color="#CC6666">Online Lesson:</font> Transportation: They Say We Had a Revolution (Part 1)</b></a><br><a href='http://www.econedlink.org/' target='_blank'>EconEdLink.org</a></p><br><p class="smaller_text">Advancements in transportation have played a key role in the growth of our nation. U.S.government policies have also had a considerable impact on the development of transport as we know it today. In this series of three lessons,the students examin...</p><br><p>--------------------------------------------------------------------</p><p><a href="event:function=viewLesson,603"><b><font color="#CC6666">Online Lesson:</font> The Benefits of Investing Early</b></a><br><a href='http://www.econedlink.org/' target='_blank'>EconEdLink.org</a></p><br><p class="smaller_text">The students will see how compounding returns make investing at a young age pay off.</p><br><p>--------------------------------------------------------------------</p><p><a href="event:function=viewLesson,570"><b><font color="#CC6666">Online Lesson:</font> Timing Is Everything</b></a><br><a href='http://www.econedlink.org/' target='_blank'>EconEdLink.org</a></p><br><p class="smaller_text">In the first part of the lesson students examine the incentives and opportunity costs of spending and saving in a teacher directed lesson. The remainder of the lesson is an interactive web site. Students work through problems that demonstrate...</p><br><p>--------------------------------------------------------------------</p><p><a href="event:function=viewLesson,566"><b><font color="#CC6666">Online Lesson:</font> Developing a Financial Investment Portfolio</b></a><br><a href='http://www.econedlink.org/' target='_blank'>EconEdLink.org</a></p><br><p class="smaller_text">Students are given brief descriptions of three individuals. They act as financial advisors and develop a financial investment portfolio for each client using internet references as they analyze various saving options. The internet web sites a...</p><br><p>--------------------------------------------------------------------</p><p><a href="event:function=viewLesson,335"><b><font color="#CC6666">Online Lesson:</font> Here's Your Chance to Make Millions in the Stock Market (Part 3)</b></a><br><a href='http://www.econedlink.org/' target='_blank'>EconEdLink.org</a></p><br><p class="smaller_text">In Part III of this lesson, students will have the opportunity to complete an interactive exercise that will take them on a historical tour of the stock market from Post WWII through the year 2001. Students will learn the difference between a...</p><br><p class="tipHeading">Middle School Lessons</p><p>--------------------------------------------------------------------</p><p><a href="event:function=viewLesson,68241"><b>Theme 4: Lesson 10 - Why Save?</b></a><br><a href="event:function=viewPublication,136">Financial Fitness for Life: Grades 6-8 - Teacher Guide</a></p><br><p class="smaller_text">The students learn about saving and investing, and they consider the importance of setting short-term, medium-term, and long-term savings goals. They use math skills to solve problems and they play a game designed to emphasize the importance of se...</p><br><p>--------------------------------------------------------------------</p><p><a href="event:function=viewLesson,62214"><b>Chapter 3: Lesson 16 - The Big Piggy Bank Mystery</b></a><br><a href="event:function=viewPublication,45">The Great Economic Mysteries Book: A Guide to Teaching Economic Reasoning, Grades 4-8</a></p><br><p class="smaller_text">Students describe an economic mystery and discuss various explanations of it. They use economic principles and true/false clues in reasoning out a solution to the mystery.</p><br><p>--------------------------------------------------------------------</p><p><a href="event:function=viewLesson,62645"><b>Lesson 15 - Savers And Borrowers</b></a><br><a href="event:function=viewPublication,49">Focus: Middle School Economics</a></p><br><p class="smaller_text">In this lesson, students encounter difficulties in lending and borrowing. They identify financial institutions as effective intermediaries in this process. In closure they discuss the role credit can have on the growth of a community.</p><br> <p class="tipHeading">Elementary Lessons</p><p>--------------------------------------------------------------------</p><p><a href="event:function=viewLesson,68203"><b>Theme 2: Lesson 7 - Saving Makes Us Wait</b></a><br><a href="event:function=viewPublication,131">Financial Fitness for Life: K-2 - Teacher Guide</a></p><br><p class="smaller_text">In a simulation activity, the students set a goal and save money to achieve that goal. They discuss the costs and benefits of saving by completing a decision grid. Using a magic mirror, they gaze into the future and imagine things they will want t...</p><br><p>--------------------------------------------------------------------</p><p><a href="event:function=viewLesson,68202"><b>Theme 2: Lesson 6 - How We Save</b></a><br><a href="event:function=viewPublication,131">Financial Fitness for Life: K-2 - Teacher Guide</a></p><br><p class="smaller_text">The class hears a story about Nicholas's family as it copes with an unexpected expense. In an activity designed to simulate an experience of scarcity, the students try to fit themselves into a space that is too small to accommodate them. They lear...</p><br><p>--------------------------------------------------------------------</p><p><a href="event:function=viewLesson,68201"><b>Theme 2: Lesson 5 - Why We Save</b></a><br><a href="event:function=viewPublication,131">Financial Fitness for Life: K-2 - Teacher Guide</a></p><br><p class="smaller_text">The students create a banner depicting choices they make and the opportunity costs they incur. They learn about saving money in order to satisfy a want. They make and decorate a special vest. The vest serves as a prop which they use in considering...</p><br><p>--------------------------------------------------------------------</p><p><a href="event:function=viewLesson,68167"><b>Theme 2: Lesson 4 - The Grasshopper and the Ant</b></a><br><a href="event:function=viewPublication,134">Financial Fitness for Life: Grades 3-5 - Teacher Guide</a></p><br><p class="smaller_text">In reading and discussing an adaptation of Aesop's fable 'The Grasshopper and the Ant,' the students learn about the trade-off between satisfying wants today and planning for the future. They use the fable to examine their own behavior and decisio...</p><br><p>--------------------------------------------------------------------</p><p><a href="event:function=viewLesson,67942"><b>Lesson 21: Lunch Money</b></a><br><a href="event:function=viewPublication,116">Teaching Economics Using Children's Literature</a></p><br><p class="smaller_text">Greg is a sixth grader with a love for money. He had his first lemonade stand in second grade and is always looking for new ways to make money. Greg recently discovered that most students bring extra money to school each day, so he has decided it'...</p><br><p>--------------------------------------------------------------------</p><p><a href="event:function=viewLesson,67932"><b>Lesson 11: My Rows and Piles of Coins</b></a><br><a href="event:function=viewPublication,116">Teaching Economics Using Children's Literature</a></p><br><p class="smaller_text">A Tanzanian boy saves his coins to buy a bicycle so that he can help his parents carry goods to market. He eventually discovers that in spite of all he has saved, he still does not have nearly enough money.</p><br><p>--------------------------------------------------------------------</p><p><a href="event:function=viewLesson,67929"><b>Lesson 8: Uncle Jed's Barbershop</b></a><br><a href="event:function=viewPublication,116">Teaching Economics Using Children's Literature</a></p><br><p class="smaller_text">Uncle Jed's Barbershop is a heartwarming story about a barber who travels the countryside cutting poor folks' hair. Uncle Jed has a kind heart and a giving spirit. He lives for the day that he can own his own barbershop. It takes a long time an...</p><br><p>--------------------------------------------------------------------</p><p><a href="event:function=viewLesson,67123"><b>Lesson 11: Plenty of Pennies</b></a><br><a href="event:function=viewPublication,102">Mathematics & Economics: Connections for Life - 3-5</a></p><br><p class="smaller_text">This lesson focuses on interest (economics) and percents (mathematics). The students use pennies to help them compute percents. They convert percent to decimals and figure interest amounts on savings or borrowed money. They role-play to understand...</p><br><p>--------------------------------------------------------------------</p><p><a href="event:function=viewLesson,61983"><b>Lesson 2: Savings Accounts and U.S. Savings Bonds</b></a><br><a href="event:function=viewPublication,101">Learning, Earning and Investing: Grades 4-5 Lessons</a></p><br><p class="smaller_text">People who want to save money can do so in various ways. One method is to use a savings account; another is to buy U. S. Savings Bonds. In this lesson, the students learn about these two methods of saving.</p><br><p>--------------------------------------------------------------------</p><p><a href="event:function=viewLesson,61982"><b>Lesson 1: Stock Prices</b></a><br><a href="event:function=viewPublication,101">Learning, Earning and Investing: Grades 4-5 Lessons</a></p><br><p class="smaller_text">Newspaper and Internet listings of stock prices provide important information for investors. Gathering and understanding information found in the stock listings is an important life skill, and also a useful skill for students participating in stoc...</p><br> ]]></lessons>
<tips><![CDATA[<p class="tipHeading">Tip #1</p><p>Have younger students participate in an activity that has them saving to reach a personal goal or a class goal. Discuss the idea that saving means giving up something now in order to have something in the future. Use children's literature such as <i>Just a Piggy Bank</i> or <i>The Hard-Times Jar</i> to help the students recognize the importance of saving.</p><br><p class="tipHeading">Tip #2</p><p>Encourage your students to save early and often in order to take advantage of compound interest. There are many lessons that show how much more a person's savings increase when the person starts saving just a few years earlier than someone else does.</p><br><p class="tipHeading">Tip #3</p><p>Here is a way to have the students compare the advantages and disadvantages of various investments. Tell the students that they have $5,000 to invest and they will need the $5,000 in five years. Write the names of various investments (savings account, certificate of deposit, government bond, corporate bond, individual stock, stock mutual fund, money market mutual fund) on sheets of paper, and place the sheets of paper on the classroom floor. Then have the students go to the investments they would choose. Ask them to defend their choices, and discuss the advantages and disadvantages of various investments.</p><br>]]></tips>
<resources><![CDATA[<p><b>Interactive tools:</b><br /></p><p><font color="#CC6666">Flash</font> <a href='http://www.econedlink.org/i146' target='_blank'>Saving and Investing Blitz</a></p><p>In this game, students will be asked a series of multiple choice questions. The longer it takes to answer, the less the question is worth. If they take too long, it won't be worth anything!<br><font size="-10"><br /></font><font size="-3">Date Published: 02/16/2011<br>Grades: 6-8, 9-12<br />Source: <a href='http://www.econedlink.org/' target='_blank'>EconEdLink.org</a></font></p><br><p><font color="#CC6666">Video</font> <a href='http://www.econedlink.org/i163' target='_blank'>Making Sen$e with Paul Solman: Is Your Pension Safe? States Struggle With Pricey Challenges</a></p><p>As part of his continuing coverage of Making Sen$e of financial news, economics correspondent Paul Solman reports from Rhode Island on the struggles that states are facing over how to calculate investment returns for public pension funds to keep t...<br><font size="-10"><br /></font><font size="-3">Date Published: 06/22/2011<br>Grades: 9-12<br />Source: <a href='http://www.econedlink.org/' target='_blank'>EconEdLink.org</a></font></p><br><p><font color="#CC6666">Flash</font> <a href='http://www.econedlink.org/i102' target='_blank'>Gen i Revolution - Mission 1: Building Wealth Over the Long Term</a></p><p>This interactive tool is a part of the online personal finance game, Gen i Revolution. This is one of the fifteen "Missions" available within the online game. This Mission takes about 30 minutes to complete. To sign up to play the game, you'll nee...<br><font size="-10"><br /></font><font size="-3">Date Published: 08/14/2010<br>Grades: 6-8, 9-12<br />Source: <a href='http://www.econedlink.org/' target='_blank'>EconEdLink.org</a></font></p><br><p><font color="#CC6666">Video</font> <a href='http://www.econedlink.org/i265' target='_blank'>Never Too Young: Personal Finance for Young Learners</a></p><p>This program was developed in response to a growing interest in teaching students about personal finance through settings outside of the traditional school day. The program teaches young students about financial choices, cost‐benefit analysis fo...<br><font size="-10"><br /></font><font size="-3">Date Published: 10/19/2012<br>Grades: K-2, 3-5<br />Source: <a href='http://www.econedlink.org/' target='_blank'>EconEdLink.org</a></font></p><br><p><font color="#CC6666">Video</font> <a href='http://www.econedlink.org/i229' target='_blank'>Financial Markets</a></p><p>This video teaches the concept of Financial Markets. Financial markets are those markets that exist for buying and selling financial assets. The most important financial assets for individual investors are bonds, stocks and mutual funds.<br><font size="-10"><br /></font><font size="-3">Date Published: 07/12/2012<br>Grades: 6-8, 9-12<br />Source: <a href='http://www.econedlink.org/' target='_blank'>EconEdLink.org</a></font></p><br><p>-------------------------------------</p><p><b>Lessons:</b></p><br><p><a href='http://www.econedlink.org/e1057' target='_blank'>Opportunity Cost</a></p><p>Consumers are faced with tough choices because so many innovative and exciting products and services are available. Therefore, engraining a decision-making process that includes considering of opportunity cost is necessary to shape future consumer behavior.<br><font size="-10"><br /></font><font size="-3">Date Published: 01/03/2012<br />Grades: 9-12<br />Source: <a href='http://www.econedlink.org/' target='_blank'>EconEdLink.org</a></font></p><br><p><a href='http://www.econedlink.org/e515' target='_blank'>Climbing the Savings Mountain</a></p><p>Students discover how saving money can be compared to a mountain climb. The climb can be fast or slow, safe or hazardous, scenic or thrilling. You will find out that there is more than one way to get to the top!<br><font size="-10"><br /></font><font size="-3">Date Published: 12/17/2003<br />Grades: 6-8<br />Source: <a href='http://www.econedlink.org/' target='_blank'>EconEdLink.org</a></font></p><br><p><a href='http://www.econedlink.org/e1029' target='_blank'>A Penny Saved</a></p><p>Students will read the comic book, "A Penny Saved" published by the New York Federal Reserve Bank. Students will make the information relevant through projects, graphic organizers, teacher instruction, and problems.<br><font size="-10"><br /></font><font size="-3">Date Published: 01/03/2012<br />Grades: 9-12<br />Source: <a href='http://www.econedlink.org/' target='_blank'>EconEdLink.org</a></font></p><br><p><a href='http://www.econedlink.org/e585' target='_blank'>You Can BANK on This! (Part 3)</a></p><p>Building on the first two lessons in the series, this lesson deals with savings and interest.<br><font size="-10"><br /></font><font size="-3">Date Published: 07/25/2005<br />Grades: 3-5<br />Source: <a href='http://www.econedlink.org/' target='_blank'>EconEdLink.org</a></font></p><br><p><a href='http://www.econedlink.org/e1008' target='_blank'>Calculating Simple Interest</a></p><p>How do banks calculate the amount of interest paid on a loan? In this lesson, students will view a Livescribe Pencast to learn how to find the dollar amount in interest that is due at maturity. This lesson uses different time periods such as days, months, and years in the calculation as well as varying interest rates.<br><font size="-10"><br /></font><font size="-3">Date Published: 10/20/2011<br />Grades: 6-8, 9-12<br />Source: <a href='http://www.econedlink.org/' target='_blank'>EconEdLink.org</a></font></p><br>]]></resources>
<related>
<concept>48</concept>
<concept>65</concept>
<concept>49</concept>
<concept>43</concept>
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<quiz>1</quiz>
</concept>
<concept>
<id>57</id>
<name>Scarcity</name>
<category>0</category>
<definition><![CDATA[<p>Individuals have <a href="event:function=defineGlossaryTerm,Wants">wants</a> that are, for practical purposes, unlimited. But the total <a href="event:function=defineGlossaryTerm,Resources">resources</a> of society, including <a href="event:function=defineGlossaryTerm,Natural Resources">natural resources</a>, <a href="event:function=defineGlossaryTerm,Human Resources">human resources</a>, <a href="event:function=defineGlossaryTerm,Capital">capital goods</a> and <a href="event:function=defineGlossaryTerm,Entrepreneurship">entrepreneurship</a>, are limited, so that <b>scarcity </b>exists. As a result, it isn't possible for everyone to have everything he or she wants. No society has ever had enough resources to produce the full amount and variety of <a href="event:function=defineGlossaryTerm,Goods">goods</a> and <a href="event:function=defineGlossaryTerm,Services">services</a> its members wanted. In a world of <a href="event:function=defineGlossaryTerm,Scarcity">scarcity</a>, producing any one good or service means that other goods and services cannot be produced, and <a href="event:function=defineGlossaryTerm,Trade-off">trade-offs</a> are inevitable.</p>]]></definition>
<lessons><![CDATA[<p>Below are <b>featured</b> lessons for teaching Scarcity.</p><br><p class="tipHeading">High School Lessons</p><p>--------------------------------------------------------------------</p><p><a href="event:function=viewLesson,68036"><b>Lesson 10 - An Economic Analysis of Health Care Policy</b></a><br><a href="event:function=viewPublication,118">Focus: Understanding Economics in Civics and Government</a></p><br><p class="smaller_text">The students discuss the strengths and weaknesses of health care in the United States. As "members" of the Surgeon General's Task Force on the Economics of Health Care Policies, they consider how the laws of supply and demand can be used to analyz...</p><br><p>--------------------------------------------------------------------</p><p><a href="event:function=viewLesson,67637"><b>Lesson 2 - Why People Trade, Domestically and Internationally</b></a><br><a href="event:function=viewPublication,109">Focus: Globalization</a></p><br><p class="smaller_text">Students participate in a trading game and discuss why people trade. Then they apply the concept of comparative advantage to two hypothetical situations involving individuals and countries. They learn why both parties in voluntary trades can benef...</p><br><p>--------------------------------------------------------------------</p><p><a href="event:function=viewLesson,68059"><b>Lesson 3 - The Classy Card Company</b></a><br><a href="event:function=viewPublication,133">Economics from Here to There </a></p><br><p class="smaller_text">The students form the Classy Card Company to produce greeting cards. The company has orders for birthday cards from two different businesses. Because of scarcity, the Classy Card Company cannot produce enough cards to fill both orders. The workers...</p><br><p>--------------------------------------------------------------------</p><p><a href="event:function=viewLesson,15423"><b>Lesson 2 - Economic Decision Making</b></a><br><a href="event:function=viewPublication,2">Economics in Action: 14 Greatest Hits for Teaching High School Economics</a></p><br><p class="smaller_text">Students brainstorm ways to allocate a scarce good within the classroom. Then they work with a decision-making model that helps them make a decision about this allocation by showing them how to evaluate the merits of each alternative. Finally, s...</p><br><p>--------------------------------------------------------------------</p><p><a href="event:function=viewLesson,20821"><b>Lesson 7: The Mathematics of Nonlinear Economic Shapes: The Production Possibilities Curve</b></a><br><a href="event:function=viewPublication,11">Mathematics & Economics: Connections for Life - 9-12</a></p><br><p class="smaller_text">Because the resources (such as raw materials, minerals, energy, labor, equipment, machinery, etc.) that are used to produce goods and services are limited in their availability, we cannot have all that we want. When limited resources come into con...</p><br> <p>--------------------------------------------------------------------</p><p><a href="event:function=viewLesson,795"><b><font color="#CC6666">Online Lesson:</font> Traditional Economies and the Inuit</b></a><br><a href='http://www.econedlink.org/' target='_blank'>EconEdLink.org</a></p><br><p class="smaller_text">The Inuit people of northern Canada provide an example of a traditional economy. For thousands of years, Inuit parents have taught their children the survival skills needed to survive in the Arctic Circle's severe climate. Students will research ...</p><br><p>--------------------------------------------------------------------</p><p><a href="event:function=viewLesson,776"><b><font color="#CC6666">Online Lesson:</font> Marketplace: The Argentina Barter Fair</b></a><br><a href='http://www.econedlink.org/' target='_blank'>EconEdLink.org</a></p><br><p class="smaller_text">In April 2002, Argentina's economic situation seemed to be getting worse and worse. Banks closed for nine days before reopening on April 29, 2002. How did Argentinians function during that time? Amy Radil of NPR reported on the flourishing barter ...</p><br><p>--------------------------------------------------------------------</p><p><a href="event:function=viewLesson,660"><b><font color="#CC6666">Online Lesson:</font> Education: Weigh Your Options</b></a><br><a href='http://www.econedlink.org/' target='_blank'>EconEdLink.org</a></p><br><p class="smaller_text">Getting and keeping a job often requires special education or training. While an employer may provide or pay for some additional education or training, workers often have to obtain it on their own. In this lesson, students use a weighted decision-...</p><br><p>--------------------------------------------------------------------</p><p><a href="event:function=viewLesson,535"><b><font color="#CC6666">Online Lesson:</font> The Price We Pay for Health: US and Canada</b></a><br><a href='http://www.econedlink.org/' target='_blank'>EconEdLink.org</a></p><br><p class="smaller_text">Students will review the health systems of United States and Canada. They will identify the positive aspects of each system. They will look at the trade-offs associated with those positive aspects. In Canada, everyone has health care, but c...</p><br><p>--------------------------------------------------------------------</p><p><a href="event:function=viewLesson,42"><b><font color="#CC6666">Online Lesson:</font> Tapped Dry: How Do You Solve a Water Shortage?</b></a><br><a href='http://www.econedlink.org/' target='_blank'>EconEdLink.org</a></p><br><p class="smaller_text">Economists do not operate in a vacuum. If an economist is going to suggest that the price of a good needs to be increased, he or she needs to consider who will bear the increase in costs. Will the costs be distributed equally or will one grou...</p><br><p class="tipHeading">Middle School Lessons</p><p>--------------------------------------------------------------------</p><p><a href="event:function=viewLesson,67915"><b>Unit 2: Trees and Forests</b></a><br><a href="event:function=viewPublication,107">Energy, Economics, and the Environment: Case Studies and Teaching Activities for Elementary School</a></p><br><p class="smaller_text">Trees and forests are a vital natural resource and affect our lives in innumerable ways. Therefore, it is very important that we learn how to manage our forest resource effectively. Fortunately, forest management in the United States has improved ...</p><br><p>--------------------------------------------------------------------</p><p><a href="event:function=viewLesson,67871"><b>Lesson 2 - Back-to-School Scarcity</b></a><br><a href="event:function=viewPublication,115">Focus: Economics - Grades 3-5</a></p><br><p class="smaller_text">While producing classroom decorations, student groups realize there is a scarcity of human resources. There are not enough students to produce the quantity of decorations the teacher requests in the time allowed. Because of scarcity each group m...</p><br><p>--------------------------------------------------------------------</p><p><a href="event:function=viewLesson,60331"><b>Lesson 1 - What Are Productive Resources?</b></a><br><a href="event:function=viewPublication,53">Middle School World Geography: Focus on Economics</a></p><br><p class="smaller_text">In this lesson, the students become economic detectives and try to determine how economists categorize productive resources. Working in groups, the students sort cards into categories they create and then specify the characteristics of each catego...</p><br><p>--------------------------------------------------------------------</p><p><a href="event:function=viewLesson,20763"><b>Lesson 1: There's Never Enough</b></a><br><a href="event:function=viewPublication,9">The Wide World of Trade</a></p><br><p class="smaller_text">Working in groups that represent countries, students randomly draw cards from boxes labeled natural resources, human resources, and capital goods. The groups use their available resources to provide for their citizens by satisfying their wants fo...</p><br><p>--------------------------------------------------------------------</p><p><a href="event:function=viewLesson,62644"><b>Lesson 14 - No Free Lunch</b></a><br><a href="event:function=viewPublication,49">Focus: Middle School Economics</a></p><br><p class="smaller_text">Students use a decision tree to analyze a budget problem at a public school</p><br> <p>--------------------------------------------------------------------</p><p><a href="event:function=viewLesson,308"><b><font color="#CC6666">Online Lesson:</font> There is Something in the Water</b></a><br><a href='http://www.econedlink.org/' target='_blank'>EconEdLink.org</a></p><br><p class="smaller_text">The United States is losing 60,000 acres of wetlands each year. Is this good or bad? Does anyone really want to live in swamps, fens, bogs, and marshes? Or is it better economics to drain the wetlands for other purposes like agricultural develop...</p><br><p>--------------------------------------------------------------------</p><p><a href="event:function=viewLesson,325"><b><font color="#CC6666">Online Lesson:</font> A Moo-ving Experience</b></a><br><a href='http://www.econedlink.org/' target='_blank'>EconEdLink.org</a></p><br><p class="smaller_text">Students gain an understanding about non-profit organizations and the role they play in our economy. Students then learn about a relatively new type of fundraising effort, known as CowParade©, for non- profit organizations that has been s...</p><br><p>--------------------------------------------------------------------</p><p><a href="event:function=viewLesson,51"><b><font color="#CC6666">Online Lesson:</font> The Opportunity Cost of a Lifetime</b></a><br><a href='http://www.econedlink.org/' target='_blank'>EconEdLink.org</a></p><br><p class="smaller_text">All economic questions and problems arise from scarcity. Economics assumes people do not have the resources do satisfy all of their wants. Therefore, we must make choices about how to allocate those resources. We make decisions about how to s...</p><br><p class="tipHeading">Elementary Lessons</p><p>--------------------------------------------------------------------</p><p><a href="event:function=viewLesson,68202"><b>Theme 2: Lesson 6 - How We Save</b></a><br><a href="event:function=viewPublication,131">Financial Fitness for Life: K-2 - Teacher Guide</a></p><br><p class="smaller_text">The class hears a story about Nicholas's family as it copes with an unexpected expense. In an activity designed to simulate an experience of scarcity, the students try to fit themselves into a space that is too small to accommodate them. They lear...</p><br><p>--------------------------------------------------------------------</p><p><a href="event:function=viewLesson,68169"><b>Theme 3: Lesson 6 - Consumers Want More Goods and Services</b></a><br><a href="event:function=viewPublication,134">Financial Fitness for Life: Grades 3-5 - Teacher Guide</a></p><br><p class="smaller_text">This lesson focuses on spending decisions, particularly the decisions that students make as consumers. The activities establish a rationale for the study of financial decision making. The lesson is introduced on one day and completed after the stu...</p><br><p>--------------------------------------------------------------------</p><p><a href="event:function=viewLesson,67935"><b>Lesson 14: A Chair for My Mother</b></a><br><a href="event:function=viewPublication,116">Teaching Economics Using Children's Literature</a></p><br><p class="smaller_text">When all their possessions were burned in a fire, a little girl, her mother, and grandmother save all their extra money to buy a special chair. The characters make choices to save in order to obtain something important to them.</p><br><p>--------------------------------------------------------------------</p><p><a href="event:function=viewLesson,62313"><b>Lesson 1: Everybody Wants Everything</b></a><br><a href="event:function=viewPublication,58">Master Curriculum Guides in Economics: Teaching Strategies - 3-4</a></p><br><p class="smaller_text">Scarcity is the basic economic problem. Because human wants are unlimited and resources are limited, people cannot have all of the goods and services they want. Scarcity requires people to make choices about which wants they satisfy.</p><br><p>--------------------------------------------------------------------</p><p><a href="event:function=viewLesson,20981"><b>Unit 3: Lesson 15 - Scarcity Bulletin Board: Balloon Trip</b></a><br><a href="event:function=viewPublication,16">Master Curriculum Guides in Economics: Teaching Strategies - K-2</a></p><br><p class="smaller_text">Students take a make-believe balloon trip to places far away as they create a bulletin board display depicting scarcity and opportunity cost.</p><br><p>--------------------------------------------------------------------</p><p><a href="event:function=viewLesson,20977"><b>Unit 3: Lesson 11 - Alligator Annie and the Scarcity Adventure</b></a><br><a href="event:function=viewPublication,16">Master Curriculum Guides in Economics: Teaching Strategies - K-2</a></p><br><p class="smaller_text">Students help Alligator Annie solve scarcity problems in her around the world adventures.</p><br> <p>--------------------------------------------------------------------</p><p><a href="event:function=viewLesson,675"><b><font color="#CC6666">Online Lesson:</font> No Extra Room on the Mayflower</b></a><br><a href='http://www.econedlink.org/' target='_blank'>EconEdLink.org</a></p><br><p class="smaller_text">The students will explore the ideas of scarcity and choices by exploring a virtual model of the Mayflower. They will then pack a virtual suitcase making good choices about what they pack.</p><br><p>--------------------------------------------------------------------</p><p><a href="event:function=viewLesson,468"><b><font color="#CC6666">Online Lesson:</font> A Perfect Pet</b></a><br><a href='http://www.econedlink.org/' target='_blank'>EconEdLink.org</a></p><br><p class="smaller_text">The introduction to this lesson is a brief online story about a little girl’s visit to a pet store with her father. She considers several pets before choosing a “cute and cuddly” dog. Students are reminded that pet owners are res...</p><br><p>--------------------------------------------------------------------</p><p><a href="event:function=viewLesson,396"><b><font color="#CC6666">Online Lesson:</font> You Decide!</b></a><br><a href='http://www.econedlink.org/' target='_blank'>EconEdLink.org</a></p><br><p class="smaller_text">Think about a difficult decision you have had to make. After you decided did it work out? Why or why not? Why do you think decisions and choices are hard to make? We make personal decisions and we make decisions as groups. There is a tool you...</p><br><p>--------------------------------------------------------------------</p><p><a href="event:function=viewLesson,314"><b><font color="#CC6666">Online Lesson:</font> Economic Spotter: Scarcity with the Lewis and Clark Expedition</b></a><br><a href='http://www.econedlink.org/' target='_blank'>EconEdLink.org</a></p><br><p class="smaller_text">The Lewis and Clark expedition was filled with scarcity issues. They made life and death choices based on scarcity. In this lesson, you will travel back to the early 1800's in a time machine and travel with Lewis and Clark. See if you can spo...</p><br><p>--------------------------------------------------------------------</p><p><a href="event:function=viewLesson,267"><b><font color="#CC6666">Online Lesson:</font> Vincent van Gogh's 'Flower Beds in Holland'</b></a><br><a href='http://www.econedlink.org/' target='_blank'>EconEdLink.org</a></p><br><p class="smaller_text">Students study a painting by van Gogh called, "Flower Beds in Holland." The students recognize that this farmer made a choice to grow flowers instead of another crop. Students are introduced to the concepts of choice and opportunity...</p><br>]]></lessons>
<tips><![CDATA[<p class="tipHeading">Tip #1</p><p>Discussions of scarcity must include the fact that scarcity is a <i>relative</i> condition, not an absolute. That is, things are scarce only when they have value in alternative uses. Further, scarcity must be distinguished from shortages; they are not the same. A shortage is, in fact, a quantitative condition, while scarcity is not. For example, a shortage of gasoline can be eliminated with a change in price, but the resource from which gasoline is produced (crude oil) is always scarce because there are multiple uses. Finally, for something to be scarce, it must be both limited and desirable, again pointing to the relativity of the concept. For example, diseases like polio are limited, but because they are not desirable, they are also not scarce. Similarly, oxygen is desirable, but since access to it is essentially not limited, oxygen is not scarce either.</p><br><p class="tipHeading">Tip #2</p><p>The fact that scarcity is relative can be illustrated this way. Ask three students to come to the front of the class. Hold up two candy bars. Ask, "Are candy bars scarce?" The students will say "yes" because there are two candy bars and three students. Then hold up four candy bars. Ask, "Are candy bars still scarce?" Many students will say "no." The answer is "yes" because the scarce resources used to make candy bars could still be used to make other goods and services.</p><br>]]></tips>
<resources><![CDATA[<p><b>Interactive tools:</b><br /></p><p><font color="#CC6666">Video</font> <a href='http://www.econedlink.org/i194' target='_blank'>Scarcity</a></p><p>This video teaches the concept of Scarcity. The total resources of society, including natural resources, human resources, capital goods and entrepreneurship, are limited, causing scarcity to exist.<br><font size="-10"><br /></font><font size="-3">Date Published: 07/12/2012<br>Grades: 3-5, 6-8, 9-12<br />Source: <a href='http://www.econedlink.org/' target='_blank'>EconEdLink.org</a></font></p><br><p><font color="#CC6666">Flash</font> <a href='http://www.econedlink.org/i117' target='_blank'>What Do You Want To Be?</a></p><p>This interactive tool asks students what they would like to be when they grow up. After they make a decision, students will drag and drop each of the parts of a uniform into the correct place of the professional.<br><font size="-10"><br /></font><font size="-3">Date Published: 10/21/2010<br>Grades: K-2<br />Source: <a href='http://www.econedlink.org/' target='_blank'>EconEdLink.org</a></font></p><br><p><font color="#CC6666">Video</font> <a href='http://www.econedlink.org/i269' target='_blank'>Making Sen$e with Paul Solman: Future Unclear for Superstorm Sandy Victims Dealing with Insurance Woes</a></p><p>Despite a history of hurricanes, there were many storm victims in New York without flood insurance thinking the risk for damage was low. But after Sandy hit, many residents are faced now with huge damage bills and no idea how they'll recover. Econ...<br><font size="-10"><br /></font><font size="-3">Date Published: 11/19/2012<br>Grades: 9-12<br />Source: <a href='http://www.econedlink.org/' target='_blank'>EconEdLink.org</a></font></p><br><p><font color="#CC6666">Video</font> <a href='http://www.econedlink.org/i265' target='_blank'>Never Too Young: Personal Finance for Young Learners</a></p><p>This program was developed in response to a growing interest in teaching students about personal finance through settings outside of the traditional school day. The program teaches young students about financial choices, cost‐benefit analysis fo...<br><font size="-10"><br /></font><font size="-3">Date Published: 10/19/2012<br>Grades: K-2, 3-5<br />Source: <a href='http://www.econedlink.org/' target='_blank'>EconEdLink.org</a></font></p><br><p><font color="#CC6666">Video</font> <a href='http://www.econedlink.org/i184' target='_blank'>Decision Making/Cost-Benefit Analysis</a></p><p>This video teaches the concepts of Decision Making and Cost-Benefit Analysis. Decision making refers to the process by which rational consumers seeking their own happiness or utility will make choices. Cost-benefit analysis is a technique for deci...<br><font size="-10"><br /></font><font size="-3">Date Published: 07/12/2012<br>Grades: 3-5, 6-8, 9-12<br />Source: <a href='http://www.econedlink.org/' target='_blank'>EconEdLink.org</a></font></p><br><p>-------------------------------------</p><p><b>Lessons:</b></p><br><p><a href='http://www.econedlink.org/e852' target='_blank'>Production Possibilities Curve</a></p><p>Students will apply the concepts of scarcity, choice, and opportunity costs using a production possibilities curve. Students will interpret points inside and outside the curve. As an extension, students will see the relationship between a country's aggregate production function and its production possibilities curve.<br><font size="-10"><br /></font><font size="-3">Date Published: 12/15/2011<br />Grades: 9-12<br />Source: <a href='http://www.econedlink.org/' target='_blank'>EconEdLink.org</a></font></p><br><p><a href='http://www.econedlink.org/e592' target='_blank'>Sand Art Brownies</a></p><p>In this lesson, you will learn about substitute goods. You will have choices to make in your role as a shopper. In making these choices, you will decide whether you are willing to accept one good as a substitute for another or not. Are you willing to make substitutions at the grocery store? Complete this lesson and see.<br><font size="-10"><br /></font><font size="-3">Date Published: 05/31/2005<br />Grades: 6-8<br />Source: <a href='http://www.econedlink.org/' target='_blank'>EconEdLink.org</a></font></p><br><p><a href='http://www.econedlink.org/e535' target='_blank'>The Price We Pay for Health: US and Canada</a></p><p>Students will review the health systems of United States and Canada. They will identify the positive aspects of each system. They will look at the trade-offs associated with those positive aspects. In Canada, everyone has health care, but certain specialized medical services are not always available. In the United States, many people are not insured, yet for many people the access to technology and specialization is phenomenal. Which is the better choice? Students will also recognize that choosing between these two systems requires a trade-off between the economic goals of economic freedom and economic security.<br><font size="-10"><br /></font><font size="-3">Date Published: 03/03/2004<br />Grades: 9-12<br />Source: <a href='http://www.econedlink.org/' target='_blank'>EconEdLink.org</a></font></p><br><p><a href='http://www.econedlink.org/e470' target='_blank'>Hawaiian Economics: From the Mountains to the Sea</a></p><p>Ancient Hawaii was ruled by chiefs, who were responsible for the well-being of their people and for managing the islands' resources. The chiefs divided the islands into land districts shaped like pie slices called Ahupua'a (ah-who- pu-ah-ah.) Each Ahupua'a covered the three main regions of the islands: the mountains, the valleys, and the shore. This system was designed to allow all Hawaiian communities equal access to the limited natural resources of the islands.
Students will recognize that an island has limited natural resources, will understand that the Ahupua'a system was one method for allocating resources, and complete a Cost/Benefit Analysis of this method. Students will also come up with own method for distributing Hawaii's natural resources and compare it with the Ahupua'a method.
<br><font size="-10"><br /></font><font size="-3">Date Published: 10/28/2003<br />Grades: 3-5<br />Source: <a href='http://www.econedlink.org/' target='_blank'>EconEdLink.org</a></font></p><br><p><a href='http://www.econedlink.org/e414' target='_blank'>The ABCs of Saving</a></p><p>We save money to get things we can’t afford to buy now. Saving for the future requires patience but it can be worth it when we get what we want the most. Successful savings depends on three elements which are presented to students as the ABCs of saving. A is for Aim: setting a goal. B is for Bank: creating a place to put savings. C is for Coins and currency: making saving money a habit. Students participate in an activity in which they must distinquish between short-term and long-term goals. In a second activity, they discover that when they decide to save for a future goal, they are giving up the opportunity to buy something now. What they give up is their opportunity cost—the thing they wanted second most. The well-known fable about The Grasshopper and the Ants helps illustrate this point. Big Banks, Little Banks (http://???) can be used as a follow-up lesson introducing students to the advantages and disadvantages of different savings places.<br><font size="-10"><br /></font><font size="-3">Date Published: 08/22/2003<br />Grades: K-2, 3-5<br />Source: <a href='http://www.econedlink.org/' target='_blank'>EconEdLink.org</a></font></p><br>]]></resources>
<related>
<concept>1</concept>
<concept>4</concept>
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<concept>54</concept>
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<quiz>1</quiz>
</concept>
<concept>
<id>22</id>
<name>Supply</name>
<category>2</category>
<definition><![CDATA[<p><b>Supply</b> refers to a relationship between <a href="event:function=defineGlossaryTerm,Price">price</a> and the quantity of a good or service that <a href="event:function=defineGlossaryTerm,Firms">firms</a> are willing to produce. A higher price for a good leads to a greater quantity supplied. <a href="event:function=defineGlossaryTerm,Supply">Supply</a> is typically illustrated as an upward-sloping curve on a graph with quantity on the horizontal axis and price on the vertical axis. </p> <br><p>A change in supply means that at every possible price, a different quantity will be supplied. For example, a change in natural conditions can affect the supply of farm <a href="event:function=defineGlossaryTerm,Product">products</a>. A drought can cause the supply of farm products to decrease, while especially good weather can cause it to increase. A fall in the price of key inputs causes supply to increase; a rise in the price of key inputs causes it to decrease. An improved production technology that reduces the cost of <a href="event:function=defineGlossaryTerm,Production">production</a> will cause the supply curve to increase. </p><br><p>A change in supply is different from a change in <a href="event:function=defineGlossaryTerm,Quantity Supplied">quantity supplied</a>. The quantity supplied is a specific amount at a particular price. A change in quantity supplied is caused by a change in the price of that good or service and is illustrated on a graph as a movement along the supply curve. However, supply is a relationship that shows the quantity supplied at each price. A change in the supply of a good or service is caused by something other than the price of that good or service. On a graph an increase in supply is illustrated by a shift to the right and a decrease in supply is illustrated by a shift to the left.</p>]]></definition>
<lessons><![CDATA[<p>Below are <b>featured</b> lessons for teaching Supply.</p><br><p class="tipHeading">High School Lessons</p><p>--------------------------------------------------------------------</p><p><a href="event:function=viewLesson,67739"><b>Lesson 13: Improving Transportation</b></a><br><a href="event:function=viewPublication,105">Focus: Understanding Economics in U.S. History</a></p><br><p class="smaller_text">The students study transportation-related mysteries and related information to learn how improvements in transportation in the first half of the nineteenth century reduced the cost of making goods available to consumers.</p><br><p>--------------------------------------------------------------------</p><p><a href="event:function=viewLesson,68058"><b>Lesson 2 - The Candy Kids - Supply and Demand for Candy</b></a><br><a href="event:function=viewPublication,133">Economics from Here to There </a></p><br><p class="smaller_text">The students participate in and discuss two games aimed at giving them an understanding that consumers and producers respond to incentives and behave according to the law of demand (as illustrated by the first game) and the law of supply (as illus...</p><br><p>--------------------------------------------------------------------</p><p><a href="event:function=viewLesson,15428"><b>Lesson 7 - A Market in Wheat</b></a><br><a href="event:function=viewPublication,2">Economics in Action: 14 Greatest Hits for Teaching High School Economics</a></p><br><p class="smaller_text">Students participate as buyers or sellers in a simulation that shows how a competitive market works. They determine individual profits or losses from market transactions. They use data from the simulation to plot and interpret a graph showing supp...</p><br><p>--------------------------------------------------------------------</p><p><a href="event:function=viewLesson,20816"><b>Lesson 2: The Nature of Supply</b></a><br><a href="event:function=viewPublication,11">Mathematics & Economics: Connections for Life - 9-12</a></p><br><p class="smaller_text">This lesson develops the economic tool of supply. Supply is determined by the willingness and ability of producers to sell a product (a good or a service) at different prices. A supply curve is a graph with a positive slope in the first quadrant. ...</p><br><p>--------------------------------------------------------------------</p><p><a href="event:function=viewLesson,65763"><b>Lesson 9 - Why Do Oil Reserves Keep Increasing?</b></a><br><a href="event:function=viewPublication,95">Economics and the Environment: Ecodetectives</a></p><br><p class="smaller_text">The students view a visual regarding oil reserves and consumption. They calculate how many years it will take us to run out of oil at a given rate of consumption. The teacher then explains that the numbers on the visual were from 1970 and that in ...</p><br><p>--------------------------------------------------------------------</p><p><a href="event:function=viewLesson,15856"><b>Lesson 11 - Where Does the Price of Pizza Come From? Part 2</b></a><br><a href="event:function=viewPublication,3">Mathematics & Economics: Connections for Life - 6-8</a></p><br><p class="smaller_text">In this lesson students continue to examine where prices come from (see Lesson 10), applying the concepts of supply, demand, and equilibrium. Students will examine changes within a market for pizza utilizing linear equations as the vehicle for exa...</p><br><p>--------------------------------------------------------------------</p><p><a href="event:function=viewLesson,15855"><b>Lesson 10 - Where Does the Price of Pizza Come From? Part 1</b></a><br><a href="event:function=viewPublication,3">Mathematics & Economics: Connections for Life - 6-8</a></p><br><p class="smaller_text">This lesson challenges students to identify the source of market prices. The students will complete a series of activities that represent supply and demand. In Activity 10.1, the students are asked to plot points, connect the points through a stra...</p><br><p>--------------------------------------------------------------------</p><p><a href="event:function=viewLesson,62638"><b>Lesson 8 - How Many Should We Sell?</b></a><br><a href="event:function=viewPublication,49">Focus: Middle School Economics</a></p><br><p class="smaller_text">Students learn to predict the impact on supply of nonprice determinants and to differentiate between changes in supply and changes in quantity supplied.</p><br> <p>--------------------------------------------------------------------</p><p><a href="event:function=viewLesson,394"><b><font color="#CC6666">Online Lesson:</font> Fill 'er up, Please</b></a><br><a href='http://www.econedlink.org/' target='_blank'>EconEdLink.org</a></p><br><p class="smaller_text">Americans drive more than 2.6 trillion miles per year, that's 14,000 round trips to the sun! And for the most part, these vehicles are all running on gasoline. For many of us, we watch the price of gas as closely as the price of a gallon of m...</p><br><p class="tipHeading">Elementary Lessons</p><p>--------------------------------------------------------------------</p><p><a href="event:function=viewLesson,62355"><b>Lesson 10: Supply Changes</b></a><br><a href="event:function=viewPublication,59">Master Curriculum Guides in Economics: Teaching Strategies - 5-6</a></p><br><p class="smaller_text">Price is a very important factor that influences how much will be produced and available for sale in a market. There are, however, important determinants of supply in addition to price. In constructing the supply schedule or curve, these determi...</p><br><p>--------------------------------------------------------------------</p><p><a href="event:function=viewLesson,62354"><b>Lesson 9: Producers and Supply</b></a><br><a href="event:function=viewPublication,59">Master Curriculum Guides in Economics: Teaching Strategies - 5-6</a></p><br><p class="smaller_text">Producers are the sellers (or suppliers) of output in a market. In the circular flow of economic activity, businesses are suppliers in the market for goods and services; individuals and households are the suppliers in the market for resources. S...</p><br> <p>--------------------------------------------------------------------</p><p><a href="event:function=viewLesson,296"><b><font color="#CC6666">Online Lesson:</font> Funny Money or Phony Money?</b></a><br><a href='http://www.econedlink.org/' target='_blank'>EconEdLink.org</a></p><br><p class="smaller_text">Money is what we use to show what goods or services are worth. When you do work, you are paid with money. When you sell something, the buyer gives you money. Sometimes it’s a lot of money and sometimes it’s just a little money. Ho...</p><br><p>--------------------------------------------------------------------</p><p><a href="event:function=viewLesson,209"><b><font color="#CC6666">Online Lesson:</font> If I Ran the Zoo - Economics and Literature</b></a><br><a href='http://www.econedlink.org/' target='_blank'>EconEdLink.org</a></p><br><p class="smaller_text">Welcome to the Zoo! In this two-day lesson you will use Dr. Seuss' If I Ran The Zoo book to introduce the economic concepts to your students. You will also get the chance to use actual zoo criteria to help a zoo "choose" new animals.</p><br><p>--------------------------------------------------------------------</p><p><a href="event:function=viewLesson,169"><b><font color="#CC6666">Online Lesson:</font> On The Money</b></a><br><a href='http://www.econedlink.org/' target='_blank'>EconEdLink.org</a></p><br><p class="smaller_text">In this lesson, students explore what money is and how it differs around the world. They will compare U.S. currency with play money and with foreign currency. They will then use their knowledge to design their own money.</p><br>]]></lessons>
<tips><![CDATA[<p class="tipHeading">Tip #1</p><p>Beginning economics students often view supply as goods kept in inventory or reserve. In economics, the term "supply" refers to two sub-concepts: quantity and price. Supply is the quantity producers are willing and able to provide at different prices. The law of supply states that when prices increase, producers provide more, and when prices decrease, producers provide less. Many reports in the media--even in the business pages of the newspaper--fail to use the term correctly. Ask the students to read a newspaper or check other media for errors in using the term "supply."</p><br><p class="tipHeading">Tip #2</p><p>Have the students consider supply as a prediction or a forecasting device which anticipates what producers will do if one incentive (price) is changed and no other incentives are changed. As prices rise, the additional revenue will encourage producers to produce more. As prices fall, the reduced revenue will encourage producers to reduce production.</p><br><p class="tipHeading">Tip #3</p><p>Tell the students that supply describes the behavior of sellers. To illustrate this, you are willing to buy push-ups from the students. <br>(A) Tell the students you will give them one extra-credit point for 20 push-ups. Ask how many will take your offer. Then make them do the push-ups. If a student says that he or she is injured, tell the student "tough" or "too bad." You pay for performance. This is how markets work.<br>(B) Repeat the procedure for two extra-credit points. The students who did push-ups for one point will want to do push-ups for two. Let them. This will show them more clearly that a supply curve is cumulative. Businesses that will sell a product for $1 will also sell it for $2. In any market, some producers have producer surplus.<br>(C) Repeat the procedure for three extra-credit points.<br>(D) Construct a supply curve with push-ups (quantity) on the horizontal axis and points (price) on the vertical axis.<br>(E) Now ask the students why they would sell more push-ups at a higher price. Point out that price is an incentive to producers to produce what consumers want to buy.</p><br><p class="tipHeading">Tip #4</p><p>Students often confuse a change in supply with a change in the quantity supplied. A change in the quantity supplied can be caused only by a change in the price of a good. It is a movement along the curve. A change in supply is a shift of the curve where more or less is supplied at every price. Changes in technology, production costs, taxes, subsidies and expectations will cause a shift in supply.</p><br>]]></tips>
<resources><![CDATA[<p><b>Interactive tools:</b><br /></p><p><font color="#CC6666">Video</font> <a href='http://www.econedlink.org/i216' target='_blank'>Markets and Prices</a></p><p>This video teaches the concept of Markets and Prices. A market refers to a group of buyers and sellers for a given good or service. The price is the amount of money needed to buy a particular good or service.<br><font size="-10"><br /></font><font size="-3">Date Published: 07/12/2012<br>Grades: 6-8, 9-12<br />Source: <a href='http://www.econedlink.org/' target='_blank'>EconEdLink.org</a></font></p><br><p><font color="#CC6666">Video</font> <a href='http://www.econedlink.org/i217' target='_blank'>Price Ceilings and Floors</a></p><p>This video teaches the concept of Price Ceilings and Floors. A price ceiling is a legally established maximum price while a price floor is a legally established minimum price.<br><font size="-10"><br /></font><font size="-3">Date Published: 07/12/2012<br>Grades: 9-12<br />Source: <a href='http://www.econedlink.org/' target='_blank'>EconEdLink.org</a></font></p><br><p><font color="#CC6666">Video</font> <a href='http://www.econedlink.org/i218' target='_blank'>Producers</a></p><p>This video teaches the concept of Producers. Producers use scarce resources to produce goods and services which they offer to sell to consumers.<br><font size="-10"><br /></font><font size="-3">Date Published: 07/12/2012<br>Grades: 3-5, 6-8, 9-12<br />Source: <a href='http://www.econedlink.org/' target='_blank'>EconEdLink.org</a></font></p><br><p><font color="#CC6666">Video</font> <a href='http://www.econedlink.org/i221' target='_blank'>Supply</a></p><p>This video teaches the concept of Supply. Supply refers to a relationship between price and the quantity of a good or service that firms are willing to produce.<br><font size="-10"><br /></font><font size="-3">Date Published: 07/12/2012<br>Grades: 3-5, 6-8, 9-12<br />Source: <a href='http://www.econedlink.org/' target='_blank'>EconEdLink.org</a></font></p><br><p><font color="#CC6666">Flash</font> <a href='http://www.econedlink.org/i113' target='_blank'>Gen i Revolution - Mission 12: Stock Market Fundamentals</a></p><p>This interactive tool is a part of the online personal finance game, Gen i Revolution. This is one of the fifteen "Missions" available within the online game. This Mission takes about 30 minutes to complete. To sign up to play the game, you'll nee...<br><font size="-10"><br /></font><font size="-3">Date Published: 08/14/2010<br>Grades: 6-8, 9-12<br />Source: <a href='http://www.econedlink.org/' target='_blank'>EconEdLink.org</a></font></p><br><p>-------------------------------------</p><p><b>Lessons:</b></p><br><p><a href='http://www.econedlink.org/e692' target='_blank'>Henry Ford and the Model T: A Case Study in Productivity (Part 3)</a></p><p>When Henry Ford announced he was going to produce an automobile that would be affordable to the masses, it is doubtful even he realized the far reaching impact such an achievement would have on life in the U.S. and eventually, the world. Ford’s use of mass production strategies to manufacture the Model T revolutionized industrial manufacturing and initiated a new era in personal transportation. This 3-part learning unit provides students with the story of Henry Ford and the Model T from an economics perspective. Parts 1 and 2 explore how the Ford Motor Company successfully introduced mass production strategies to the auto industry. Students learn how specialization and investments in capital (machines, people, etc.) increased productivity and allowed Ford to slash the price of his popular vehicle. Students chart a plan for the assembly line production of bookmarks, test their plan and make recommendations for improvements. Students also explore how Henry Ford used economic incentives to address a problem created by mass production techniques—worker turnover. An optional Part 3 explains how increased productivity resulted in shifts in the supply and demand for the Model T. Students analyze how a variety of non price determinants continue to influence the automobile market today. A wealth of extension activities is provided if additional time is available.<br><font size="-10"><br /></font><font size="-3">Date Published: 01/15/2008<br />Grades: 6-8, 9-12<br />Source: <a href='http://www.econedlink.org/' target='_blank'>EconEdLink.org</a></font></p><br><p><a href='http://www.econedlink.org/e719' target='_blank'>Transportation: They Say We Had a Revolution (Part 1)</a></p><p>Advancements in transportation have played a key role in the growth of our nation. U.S.government policies have also had a considerable impact on the development of transport as we know it today. In this series of three lessons,the students examine transportation and its impact on our nation (and vice versa) since the United States declared its independence in 1776. Lesson 1 focuses on improvements in transportation during the 19th century, particularly the development of a national rail system, to show how invention, innovation and infrastructure encouraged western expansion and economic growth. Lesson 2 moves on to the 20thcentury focusing on the development of auto transport and aviation. The impact on communities and world trade, for both good and bad,is examined. Lesson 3 calls upon the students to create a class time line of transportation milestones; the time line will help the students more clearly understand the factors, especially the economic incentives,that have played a key role in what has been called the 'Transportation Revolution.' While these three lessons will ideally be used together as a set, teachers may choose to use one or two of them, selectively, to focus, for example, on the 19th or the 20th century. If you would like your students to study the economics of transportation in more depth, consider following up with the EconEdLink lesson, An Economic Mystery: What Happened to Railroads?<br><font size="-10"><br /></font><font size="-3">Date Published: 01/30/2008<br />Grades: 6-8, 9-12<br />Source: <a href='http://www.econedlink.org/' target='_blank'>EconEdLink.org</a></font></p><br><p><a href='http://www.econedlink.org/e694' target='_blank'>What Happened to Railroads?</a></p><p>Between the Civil War and World War II, railroads were one of the nation's most important businesses and an integral part of people’s lives. In this lesson, students assume the role of detectives investigating why the rail companies experienced a crisis in the 1960s and what helped the freight transport portion of the business return to profitability later in the same century. Students analyze a set of clues that help them explore the impact of government policies and changes in consumer demand on rail service. They discover that government policies (e.g., regulations, subsidies, and taxes) can have both positive and negative consequences in the marketplace. An interactive activity helps students understand that rail service competes in two different markets—passenger service and hauling freight. Students also learn that railroads and government policies have had to adjust as the transportation industry changed in the second half of the twentieth century.<br><font size="-10"><br /></font><font size="-3">Date Published: 06/07/2007<br />Grades: 9-12<br />Source: <a href='http://www.econedlink.org/' target='_blank'>EconEdLink.org</a></font></p><br><p><a href='http://www.econedlink.org/e458' target='_blank'>What Do People Want to Wear?</a></p><p>To stay in business, fashion merchandisers must be able to anticipate what consumers want. By looking at different retail websites, students will look to anticipate what consumers are demanding. Students will then go through the market scenarios for each product and try to anticipate the effect the scenario will have on the demand and price (assuming constant supply) for the product they have chosen.<br><font size="-10"><br /></font><font size="-3">Date Published: 07/22/2003<br />Grades: 6-8, 9-12<br />Source: <a href='http://www.econedlink.org/' target='_blank'>EconEdLink.org</a></font></p><br><p><a href='http://www.econedlink.org/e328' target='_blank'>Economic Spotter: Supply and Demand at the Gold Rush</a></p><p>During the Gold Rush, people paid exorbitant prices for ordinary objects. Why? Because of the laws of supply and demand, that's why! In the lesson, students will see how these laws fit into this great historical time.<br><font size="-10"><br /></font><font size="-3">Date Published: 07/23/2002<br />Grades: 3-5, 6-8<br />Source: <a href='http://www.econedlink.org/' target='_blank'>EconEdLink.org</a></font></p><br>]]></resources>
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<concept>34</concept>
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<concept>
<id>71</id>
<name>Technology</name>
<category>0</category>
<definition><![CDATA[<p>The set of instructions or blueprints that inform <a href="event:function=defineGlossaryTerm,Producers">producers</a> about the various ways that <a href="event:function=defineGlossaryTerm,Capital">capital</a> and <a href="event:function=defineGlossaryTerm,Labor">labor</a> can be combined to produce a particular <a href="event:function=defineGlossaryTerm,Product">product</a> is the <b>technology</b> of production. From these possible input <a href="event:function=defineGlossaryTerm,Choice">choices</a>, producers select combinations of labor and capital to produce output that maximizes <a href="event:function=defineGlossaryTerm,Profit">profits</a>. The technology of <a href="event:function=defineGlossaryTerm,Production">production</a> defines the <a href="event:function=defineGlossaryTerm,Productivity">productivity</a> of <a href="event:function=defineGlossaryTerm,Resources">resources</a>, and improvements in technology typically increase productivity of resources. A "change in technology" usually refers to new ways to produce more or better output with the same quantities of input resources (or the same output level with fewer input resources).</p> ]]></definition>
<lessons><![CDATA[<p>Below are <b>featured</b> lessons for teaching Technology.</p><br><p class="tipHeading">High School Lessons</p><p>--------------------------------------------------------------------</p><p><a href="event:function=viewLesson,67764"><b>Lesson 38: The Knowledge and Technology-Based Economy of Today</b></a><br><a href="event:function=viewPublication,105">Focus: Understanding Economics in U.S. History</a></p><br><p class="smaller_text">The students examine information about knowledge workers and their impact on economic expansion. They discuss the opportunity cost
and the benefits of investing in education beyond high school. From 1968 to the present, the knowledgebase sector of...</p><br><p>--------------------------------------------------------------------</p><p><a href="event:function=viewLesson,67752"><b>Lesson 26: Could the U.S. Economy Have Grown Without the Railroads?</b></a><br><a href="event:function=viewPublication,105">Focus: Understanding Economics in U.S. History</a></p><br><p class="smaller_text">The students examine data about economic growth and the expansion of railroads in the United States after the Civil War. They assess
ways in which the railroads may have contributed to economic growth in agriculture and the industrial sectors of t...</p><br><p>--------------------------------------------------------------------</p><p><a href="event:function=viewLesson,60315"><b>Lesson 3 - Productivity in the Fertile Crescent</b></a><br><a href="event:function=viewPublication,38">Old MacDonald to Uncle Sam: Lesson Plans from Writers around the World</a></p><br><p class="smaller_text">In this lesson, students participate in three rounds of a simulation in which they are merchants who must keep written records on their trades. In Round 1 they do not have some required skills or knowledge and are unable to produce written record...</p><br><p>--------------------------------------------------------------------</p><p><a href="event:function=viewLesson,65604"><b>Lesson 20: Catching Up or Falling Behind? International Comparisons of National Income and Economic Growth</b></a><br><a href="event:function=viewPublication,69">Focus: International Economics</a></p><br><p class="smaller_text">Student teams participate in several rounds of a production simulation to discover the causes of convergence in output and income levels in industrialized nations. Before the simulation, they examine historical evidence on these patterns of conve...</p><br><p>--------------------------------------------------------------------</p><p><a href="event:function=viewLesson,62515"><b>Lesson 10- How The Industrial Revolution Raised Living Standards</b></a><br><a href="event:function=viewPublication,70">World History: Focus on Economics</a></p><br><p class="smaller_text">The teacher conducts a brief simulation that illustrates how specialization and division of labor and improvements in capital goods increase productivity. The teacher displays a visual that shows other sources of increases in productivity. Studen...</p><br> <p>--------------------------------------------------------------------</p><p><a href="event:function=viewLesson,725"><b><font color="#CC6666">Online Lesson:</font> Transportation: They Say We Had a Revolution (Part 2)</b></a><br><a href='http://www.econedlink.org/' target='_blank'>EconEdLink.org</a></p><br><p class="smaller_text">Advancements in transportation have played a key role in the growth of our nation. U.S.government policies have also had a considerable impact on the development of transport as we know it today. In this series of three lessons, the students exami...</p><br><p>--------------------------------------------------------------------</p><p><a href="event:function=viewLesson,298"><b><font color="#CC6666">Online Lesson:</font> Blowing in the Wind</b></a><br><a href='http://www.econedlink.org/' target='_blank'>EconEdLink.org</a></p><br><p class="smaller_text">Wind energy is becoming a viable alternative to more traditional forms of energy generation. In this lesson, students will determine the feasibility of wind generation in different areas of the United States. Finally, students will explore the pos...</p><br><p>--------------------------------------------------------------------</p><p><a href="event:function=viewLesson,321"><b><font color="#CC6666">Online Lesson:</font> Market-Ability</b></a><br><a href='http://www.econedlink.org/' target='_blank'>EconEdLink.org</a></p><br><p class="smaller_text">Marketplace, a daily economics news program heard on National Public Radio, featured a story on January 8, 2002, titled "Microsoft Invades the Kitchen." In this segment, reporter Aaron Schachter describes consumers' enthusiasm, or l...</p><br><p class="tipHeading">Middle School Lessons</p><p>--------------------------------------------------------------------</p><p><a href="event:function=viewLesson,60338"><b>Lesson 8 - Ideas That Changed the World</b></a><br><a href="event:function=viewPublication,53">Middle School World Geography: Focus on Economics</a></p><br><p class="smaller_text">In this lesson, the students learn about productivity and its connection to the standard of living. They learn about inventions that changed the world. The students make predictions about recent inventions and the impact of these inventions on pro...</p><br> <p>--------------------------------------------------------------------</p><p><a href="event:function=viewLesson,263"><b><font color="#CC6666">Online Lesson:</font> Capital Chips (Part 1)</b></a><br><a href='http://www.econedlink.org/' target='_blank'>EconEdLink.org</a></p><br><p class="smaller_text">Through the use of a historical timeline of the capital investments made by the company the resulting benefits will be examined. The benefits from the capital investments of Herr Foods, Inc. will be related to their effect on the standard of...</p><br><p>--------------------------------------------------------------------</p><p><a href="event:function=viewLesson,206"><b><font color="#CC6666">Online Lesson:</font> The Mystery of the Amazing Farmers</b></a><br><a href='http://www.econedlink.org/' target='_blank'>EconEdLink.org</a></p><br><p class="smaller_text">In this lesson you will be taking on the role of an an investigative reporter to solve the Amazing Farmer Mystery. The goal will be to use seven clues provided throughout the lesson in order to figure out how so few farmers can produce enough ...</p><br><p>--------------------------------------------------------------------</p><p><a href="event:function=viewLesson,187"><b><font color="#CC6666">Online Lesson:</font> Online Music</b></a><br><a href='http://www.econedlink.org/' target='_blank'>EconEdLink.org</a></p><br><p class="smaller_text">How many students have made use of MP3 technology to download and trade music online? What are the benefits of sharing, storing and listening to music using this format? What are the drawbacks of sharing, storing and listening to music using ...</p><br>]]></lessons>
<tips><![CDATA[<p class="tipHeading">Tip #1</p><p>One way to show how technology improves productivity is to solve simple math problems with and without a calculator. Give the students 10 math problems and have them solve the problems without a calculator. Then give the students 10 more problems and let them use a calculator. In both cases, have the students keep track of the time it took and their accuracy. How did technology improve productivity?</p><br><p class="tipHeading">Tip #2</p><p>Many people incorrectly believe that technology increases unemployment. This is known as the lump of labor fallacy. In fact, technology creates jobs and increases a nation's standard of living. Of course, other jobs are lost, but overall employment increases. In 1900, 20,000,000 people were employed. Today over 130,000,000 people are employed. How many new jobs were created in the automobile, plastics, airplane, television, computer, medical and electronics industries because of improved technologies?</p><br>]]></tips>
<resources><![CDATA[<p><b>Interactive tools:</b><br /></p><p><font color="#CC6666">Video</font> <a href='http://www.econedlink.org/i192' target='_blank'>Productivity</a></p><p>This video teaches the concept of Productivity, which is measured as the quantity of output per unit of input.<br><font size="-10"><br /></font><font size="-3">Date Published: 07/12/2012<br>Grades: 6-8, 9-12<br />Source: <a href='http://www.econedlink.org/' target='_blank'>EconEdLink.org</a></font></p><br><p><font color="#CC6666">Video</font> <a href='http://www.econedlink.org/i195' target='_blank'>Technology</a></p><p>This video teaches the concept of Technology. The set of instructions or blueprints that inform producers about the various ways that capital and labor can be combined to produce a particular product is the technology of production.<br><font size="-10"><br /></font><font size="-3">Date Published: 07/12/2012<br>Grades: 3-5, 6-8, 9-12<br />Source: <a href='http://www.econedlink.org/' target='_blank'>EconEdLink.org</a></font></p><br><p><font color="#CC6666">Video</font> <a href='http://www.econedlink.org/i201' target='_blank'>Economic Growth</a></p><p>This video teaches the concept of Economic Growth. Economic growth refers to the ability of the economy to increase its total real output or real GDP, or its real output per person.<br><font size="-10"><br /></font><font size="-3">Date Published: 07/12/2012<br>Grades: 6-8, 9-12<br />Source: <a href='http://www.econedlink.org/' target='_blank'>EconEdLink.org</a></font></p><br><p><font color="#CC6666">Video</font> <a href='http://www.econedlink.org/i258' target='_blank'>Making Sen$e with Paul Solman: As Humans and Computers Merge ... Immortality?</a></p><p>Paul Solman interviews inventor Ray Kurzweil, who predicts that advancing technology will result in augmented brains, memories recorded on "mind files" and a greatly increased life span.<br><font size="-10"><br /></font><font size="-3">Date Published: 07/10/2012<br>Grades: 9-12<br />Source: <a href='http://www.econedlink.org/' target='_blank'>EconEdLink.org</a></font></p><br><p><font color="#CC6666">Video</font> <a href='http://www.econedlink.org/i246' target='_blank'>Making Sen$e with Paul Solman: Man vs. Machine: Will Human Workers Become Obsolete?</a></p><p>Part of his series on Making Sen$e of financial news, Paul Solman has been showcasing the future of technology from a recent conference run by a California think tank -- things such as 3-D printing of prosthetic legs and iPhone heart tests. But th...<br><font size="-10"><br /></font><font size="-3">Date Published: 05/24/2012<br>Grades: 9-12<br />Source: <a href='http://www.econedlink.org/' target='_blank'>EconEdLink.org</a></font></p><br><p>-------------------------------------</p><p><b>Lessons:</b></p><br><p><a href='http://www.econedlink.org/e727' target='_blank'>Transportation: They Say We Had a Revolution (Part 3)</a></p><p>Advancements in transportation have played a key role in the growth of our nation. U.S. government policies have also had a considerable impact on the development of transport as we know it today. In this series of three lessons, the students examine transportation and its impact on our nation (and vice versa) since the United States declared its independence in 1776. Lesson 1 focuses on improvements in transportation during the 19th century, particularly the development of a national rail system, to show how invention, innovation and infrastructure encouraged western expansion and economic growth. Lesson 2 moves on to the 20th century focusing on the development of auto transport and aviation. The impact on communities and world trade, for both good and bad,is examined. Lesson 3 calls upon the students to create a class timeline of transportation milestones; the timeline will help the students more clearly understand the factors, especially the economic incentives, that have played a key role in what has been called the "Transportation Revolution." While these three lessons will ideally be used together as a set, teachers may choose to use one or two of them, selectively, to focus, for example, on the 19th or the 20th century. If you would like your students to study the economics of transportation in more depth, consider following up with the EconEdLink lesson,An Economic Mystery: What Happened to Railroads?<br><font size="-10"><br /></font><font size="-3">Date Published: 02/05/2008<br />Grades: 6-8, 9-12<br />Source: <a href='http://www.econedlink.org/' target='_blank'>EconEdLink.org</a></font></p><br><p><a href='http://www.econedlink.org/e725' target='_blank'>Transportation: They Say We Had a Revolution (Part 2)</a></p><p>Advancements in transportation have played a key role in the growth of our nation. U.S.government policies have also had a considerable impact on the development of transport as we know it today. In this series of three lessons, the students examine the advancements in automobiles, roads, airlines and airports.<br><font size="-10"><br /></font><font size="-3">Date Published: 06/03/2009<br />Grades: 6-8, 9-12<br />Source: <a href='http://www.econedlink.org/' target='_blank'>EconEdLink.org</a></font></p><br><p><a href='http://www.econedlink.org/e719' target='_blank'>Transportation: They Say We Had a Revolution (Part 1)</a></p><p>Advancements in transportation have played a key role in the growth of our nation. U.S.government policies have also had a considerable impact on the development of transport as we know it today. In this series of three lessons,the students examine transportation and its impact on our nation (and vice versa) since the United States declared its independence in 1776. Lesson 1 focuses on improvements in transportation during the 19th century, particularly the development of a national rail system, to show how invention, innovation and infrastructure encouraged western expansion and economic growth. Lesson 2 moves on to the 20thcentury focusing on the development of auto transport and aviation. The impact on communities and world trade, for both good and bad,is examined. Lesson 3 calls upon the students to create a class time line of transportation milestones; the time line will help the students more clearly understand the factors, especially the economic incentives,that have played a key role in what has been called the 'Transportation Revolution.' While these three lessons will ideally be used together as a set, teachers may choose to use one or two of them, selectively, to focus, for example, on the 19th or the 20th century. If you would like your students to study the economics of transportation in more depth, consider following up with the EconEdLink lesson, An Economic Mystery: What Happened to Railroads?<br><font size="-10"><br /></font><font size="-3">Date Published: 01/30/2008<br />Grades: 6-8, 9-12<br />Source: <a href='http://www.econedlink.org/' target='_blank'>EconEdLink.org</a></font></p><br><p><a href='http://www.econedlink.org/e702' target='_blank'>Work, Earnings and Economics: Using 'Lyddie' by Katherine Paterson</a></p><p>To get started, the students will read Lyddie, a novel by Katherine Paterson. The novel is set mainly in Lowell, Massachusetts, in the 1840s. In Lowell the main character, 13-year-old Lyddie Worthen, works six days a week, from dawn until dusk, running weaving looms in a murky dust-and lintfilled factory, trying to save enough money to reunite her family. In reading and discussing this fine novel, the students examine basic economic concepts and explore the growth of labor unions and the role of government in a market economy.
Lyddie is published by Puffin Books and is available at Amazon.com. It is also available in DVD video format and may be purchased on line at Circuit City, DVD Empire.com and Overstock.com.<br><font size="-10"><br /></font><font size="-3">Date Published: 09/13/2007<br />Grades: 6-8<br />Source: <a href='http://www.econedlink.org/' target='_blank'>EconEdLink.org</a></font></p><br><p><a href='http://www.econedlink.org/e364' target='_blank'>Economic Spotter: Resources During World War II</a></p><p>In World War II pennies were made of steel and zinc instead of copper and women were working at jobs that men had always been hired to do. Why? Because during war times, scarcity forces many things to change!<br><font size="-10"><br /></font><font size="-3">Date Published: 01/03/2003<br />Grades: 3-5<br />Source: <a href='http://www.econedlink.org/' target='_blank'>EconEdLink.org</a></font></p><br>]]></resources>
<related>
<concept>11</concept>
<concept>58</concept>
</related>
<quiz>1</quiz>
</concept>
<concept>
<id>6</id>
<name>Trade, Exchange and Interdependence</name>
<category>0</category>
<definition><![CDATA[<p>People do not make everything that they and their family use: that is, they do not grow all their own food, sew their own clothes, build their own house and provide themselves personally with health care and education. Instead, people focus on a particular <a href="event:function=defineGlossaryTerm,Job">job</a> and then use the <a href="event:function=defineGlossaryTerm,Wage">wages</a> that they earn from that job to purchase the <a href="event:function=defineGlossaryTerm,Goods">goods</a> and <a href="event:function=defineGlossaryTerm,Services">services</a> they desire. In this way, an economy forms an interlinked network of <b>trade, exchange and interdependence</b>. </p> <br><p><a href="event:function=defineGlossaryTerm,Specialization">Specialization</a> is the basis of <a href="event:function=defineGlossaryTerm,Trade">trade</a> and <a href="event:function=defineGlossaryTerm,Interdependence">interdependence</a> among individuals, cities, regions and countries. Most countries do not produce all of what they <a href="event:function=defineGlossaryTerm,Consume">consume</a>. Instead, they focus more heavily on producing certain <a href="event:function=defineGlossaryTerm,Product">products</a> and trading with other countries. Thus, the global economy is a network of trade and interdependence. </p>]]></definition>
<lessons><![CDATA[<p>Below are <b>featured</b> lessons for teaching Trade, Exchange and Interdependence.</p><br><p class="tipHeading">High School Lessons</p><p>--------------------------------------------------------------------</p><p><a href="event:function=viewLesson,68040"><b>Lesson 14 - Economic Sanctions and U.S. Foreign Policy</b></a><br><a href="event:function=viewPublication,118">Focus: Understanding Economics in Civics and Government</a></p><br><p class="smaller_text">The students analyze cases in which the United States has imposed economic sanctions on other countries. They examine the characteristics of successful economic sanctions and apply their knowledge to predict the likelihood of the success of U.S. e...</p><br><p>--------------------------------------------------------------------</p><p><a href="event:function=viewLesson,67741"><b>Lesson 15:Why did the Indians of the Great Plains Invite White Americans Into Their Land?</b></a><br><a href="event:function=viewPublication,105">Focus: Understanding Economics in U.S. History</a></p><br><p class="smaller_text">The teacher introduces a mystery: Why would American Indians in the 1830s welcome contacts with white Americans? The students then participate in a simulation of trade activity among Indians, New Mexicans and American traders in
the southern Great...</p><br><p>--------------------------------------------------------------------</p><p><a href="event:function=viewLesson,67641"><b>Lesson 6 - The Impact of Globalization on Tradition and Culture</b></a><br><a href="event:function=viewPublication,109">Focus: Globalization</a></p><br><p class="smaller_text">In this lesson students investigate the impact of globalization - especially the effects of increased international trade - on local or national culture and traditions. Given a definition of culture as a shared
system of behaviors and customs, stu...</p><br><p>--------------------------------------------------------------------</p><p><a href="event:function=viewLesson,15422"><b>Lesson 1 - Why People Trade</b></a><br><a href="event:function=viewPublication,2">Economics in Action: 14 Greatest Hits for Teaching High School Economics</a></p><br><p class="smaller_text">Students participate in a trading simulation and use this experience to discover the benefits of free trade. In a class discussion, they relate the simulation to concepts of regional versus universal trade, trade barriers and diminishing marginal...</p><br><p>--------------------------------------------------------------------</p><p><a href="event:function=viewLesson,61972"><b>Lesson 5 - Clothes from Grain: A Miracle or a Problem?</b></a><br><a href="event:function=viewPublication,37">Roosters to Robots: Lesson Plans from Writers around the World</a></p><br><p class="smaller_text">Students read two fables about entrepreneurs who buy grain and turn the grain into clothing or resell the grain and use the proceeds to import clothing. Students use the information from the fables to determine why people trade and to analyze the ...</p><br><p>--------------------------------------------------------------------</p><p><a href="event:function=viewLesson,65588"><b>Lesson 4: Trading Around the World</b></a><br><a href="event:function=viewPublication,69">Focus: International Economics</a></p><br><p class="smaller_text">Students first analyze and discuss information on the major U.S. trading partners. Then they identify the parent countries of businesses that produce familiar brand name products. Finally, students participate in an activity to identify the coun...</p><br><p>--------------------------------------------------------------------</p><p><a href="event:function=viewLesson,62508"><b>Lesson 3- Trade In Africa: 9th to 12th Centuries A.D.</b></a><br><a href="event:function=viewPublication,70">World History: Focus on Economics</a></p><br><p class="smaller_text">The teacher displays a visual showing the graphic regions and trade routes between North and West Africa. Students read a short passage and answer questions in class discussion. Students in groups calculate the efficiency of various methods of t...</p><br> <p>--------------------------------------------------------------------</p><p><a href="event:function=viewLesson,855"><b><font color="#CC6666">Online Lesson:</font> The Trading Game</b></a><br><a href='http://www.econedlink.org/' target='_blank'>EconEdLink.org</a></p><br><p class="smaller_text">In this lesson, students will learn about the gains from trade. Students will participate in a trading game that will demonstrate that trade can make everyone better off.</p><br><p>--------------------------------------------------------------------</p><p><a href="event:function=viewLesson,575"><b><font color="#CC6666">Online Lesson:</font> International Trade Creates More and Better Jobs</b></a><br><a href='http://www.econedlink.org/' target='_blank'>EconEdLink.org</a></p><br><p class="smaller_text">This lesson explores the relationship between productivity and international trade. Specifically, this lessons shows why there should be fewer trade restrictions rather than more.</p><br><p>--------------------------------------------------------------------</p><p><a href="event:function=viewLesson,567"><b><font color="#CC6666">Online Lesson:</font> Trade in Colonial America / NAFTA</b></a><br><a href='http://www.econedlink.org/' target='_blank'>EconEdLink.org</a></p><br><p class="smaller_text">Often teachers and students are able to internalize historical and economic concepts through a more recent event that has occurred within their time frame. This lesson is an extension for the lesson, "Understanding the Colonial Economy.&...</p><br><p class="tipHeading">Middle School Lessons</p><p>--------------------------------------------------------------------</p><p><a href="event:function=viewLesson,67883"><b>Lesson 14 - Tic-Tac-Toe Trade</b></a><br><a href="event:function=viewPublication,115">Focus: Economics - Grades 3-5</a></p><br><p class="smaller_text">In this lesson, the students participate in an activity that demonstrates the benefits of specialization and voluntary exchange. The students are divided into two groups, representing two countries, and the students in each country produce "X's" ...</p><br><p>--------------------------------------------------------------------</p><p><a href="event:function=viewLesson,20765"><b>Lesson 3: Everyone Is Interdependent</b></a><br><a href="event:function=viewPublication,9">The Wide World of Trade</a></p><br><p class="smaller_text">In this lesson, students learn about resources from around the world that are used in the production of a specific product -- Hershey's Kisses. Students then determine the identity of a mystery product using clues about world resources that are u...</p><br><p>--------------------------------------------------------------------</p><p><a href="event:function=viewLesson,20764"><b>Lesson 2: Special Friends</b></a><br><a href="event:function=viewPublication,9">The Wide World of Trade</a></p><br><p class="smaller_text">Pairs of students play the roles of two friends who have chores to complete before they can spend time together. Through trial-and-error, students discover the benefits of specialization and trade. A second activity identifies reasons why people...</p><br> <p>--------------------------------------------------------------------</p><p><a href="event:function=viewLesson,59"><b><font color="#CC6666">Online Lesson:</font> Bill, Are You Bogus?</b></a><br><a href='http://www.econedlink.org/' target='_blank'>EconEdLink.org</a></p><br><p class="smaller_text">In a barter system, people have to trade goods and services for other goods and services. In an economy that produces millions of goods and services, barter is very difficult. Think of all the stuff (goods and services) you have.</p><br><p>--------------------------------------------------------------------</p><p><a href="event:function=viewLesson,57"><b><font color="#CC6666">Online Lesson:</font> Frontier Specialists</b></a><br><a href='http://www.econedlink.org/' target='_blank'>EconEdLink.org</a></p><br><p class="smaller_text">The level of output in an economy can be increased through specialization. Economic specialization occurs when people produce different goods and services than they consume. It requires people to exchange goods and services.</p><br><p class="tipHeading">Elementary Lessons</p><p>--------------------------------------------------------------------</p><p><a href="event:function=viewLesson,67931"><b>Lesson 10: Follow an Ice-Cream Cone Around the World</b></a><br><a href="event:function=viewPublication,116">Teaching Economics Using Children's Literature</a></p><br><p class="smaller_text">Travel around the world with the Green$treet kids as they discover what it takes to make ice cream. Through this story, the students will visit the places where the different ingredients (natural resources) in ice cream are found. There are many...</p><br><p>--------------------------------------------------------------------</p><p><a href="event:function=viewLesson,67119"><b>Lesson 7: Go Fly a Kite</b></a><br><a href="event:function=viewPublication,102">Mathematics & Economics: Connections for Life - 3-5</a></p><br><p class="smaller_text">This lesson focuses on resources and barter (economics) and geometry (mathematics). After reviewing the concept of bartering, the students roll a four-sided dice to gather some of the resources they will need to build a tetrahedron kite, which is ...</p><br><p>--------------------------------------------------------------------</p><p><a href="event:function=viewLesson,61968"><b>Lesson 1 - A Rooster and a Bean Seed</b></a><br><a href="event:function=viewPublication,37">Roosters to Robots: Lesson Plans from Writers around the World</a></p><br><p class="smaller_text">In this lesson, students hear a folk tale and participate in a simulation that helps them recognize problems with barter and benefits of monetary exchange.</p><br><p>--------------------------------------------------------------------</p><p><a href="event:function=viewLesson,20940"><b>Lesson 7: Community Interdependence</b></a><br><a href="event:function=viewPublication,15">Exploring the Marketplace: The Community Publishing Company - Teacher Resource Manual</a></p><br><p class="smaller_text">In this lesson students learn about the interdependence that exists among people and places in their community. The students listen to "The Communityville Tour" and associate the information in it with their own community.</p><br><p>--------------------------------------------------------------------</p><p><a href="event:function=viewLesson,62319"><b>Lesson 7: Let's Trade</b></a><br><a href="event:function=viewPublication,58">Master Curriculum Guides in Economics: Teaching Strategies - 3-4</a></p><br><p class="smaller_text">Barter is the direct exchange of goods and services between people, without using money. People voluntarily exchange goods and services because they expect to be better off after the exchange. When people use barter to facilitate exchange, a "do...</p><br><p>--------------------------------------------------------------------</p><p><a href="event:function=viewLesson,20982"><b>Unit 4: Lesson 16 - An Interdependent Bunch</b></a><br><a href="event:function=viewPublication,16">Master Curriculum Guides in Economics: Teaching Strategies - K-2</a></p><br><p class="smaller_text">Students create a bunch of balloon grapes to illustrate the concept that they make a "great bunch" of interdependent workers.</p><br> <p>--------------------------------------------------------------------</p><p><a href="event:function=viewLesson,578"><b><font color="#CC6666">Online Lesson:</font> You Can BANK on This! (Part 1)</b></a><br><a href='http://www.econedlink.org/' target='_blank'>EconEdLink.org</a></p><br><p class="smaller_text">Banking should not be confusing. It should be INTERESTing! Most students in the elementary grades would love to know more about checking accounts, ATMs, credit cards and all the ways in which their relatives buy the stuff that they want. This les...</p><br><p>--------------------------------------------------------------------</p><p><a href="event:function=viewLesson,289"><b><font color="#CC6666">Online Lesson:</font> A Pet For Beans from 'Jack and the Beanstalk'</b></a><br><a href='http://www.econedlink.org/' target='_blank'>EconEdLink.org</a></p><br><p class="smaller_text">After listening to a computer-read story, "Jack and the Beanstalk," the students will find out that beans were used as an exchange for Jack's cow. Jack traded his pet cow for an old man's magic beans. Were they both happy? They shoul...</p><br><p>--------------------------------------------------------------------</p><p><a href="event:function=viewLesson,269"><b><font color="#CC6666">Online Lesson:</font> Norman Rockwell's 'Curiosity Shop'</b></a><br><a href='http://www.econedlink.org/' target='_blank'>EconEdLink.org</a></p><br><p class="smaller_text">Students will look at a picture that Norman Rockwell painted about a Curiosity Shop. A little girl looks like she is about to purchase a doll. Her purse on her arm indicates that she might "exchange" money for the doll. This lesson ...</p><br><p>--------------------------------------------------------------------</p><p><a href="event:function=viewLesson,61"><b><font color="#CC6666">Online Lesson:</font> Pennies Make Cents</b></a><br><a href='http://www.econedlink.org/' target='_blank'>EconEdLink.org</a></p><br><p class="smaller_text">Students will review the history of trade before money and will investigate the history of money. Students will locate information about the first coin authorized by the United States and will learn about the penny.</p><br><p>--------------------------------------------------------------------</p><p><a href="event:function=viewLesson,67"><b><font color="#CC6666">Online Lesson:</font> I Have No Money, Would You Take Wampum?</b></a><br><a href='http://www.econedlink.org/' target='_blank'>EconEdLink.org</a></p><br><p class="smaller_text">Through the use of folk tales, history, and the students' own experiences, students will recognize the inter-relatedness of goods, services, money. They will locate information about barter as a means of trade, use folk tales as an historica...</p><br>]]></lessons>
<tips><![CDATA[<p class="tipHeading">Tip #1</p><p>Have the students identify the many goods they would be without in their community if trade did not occur. Point out that they depend on people in other parts of the state, the country and the world to produce the goods and services that they use. The students will recognize that because of specialization, people are interdependent. They can create an interdependence web for their school or community by answering the question: On whom do we depend each day? Or give each student a sign naming a worker in the community. Have the students sit on the floor. Hold a ball of yarn in your hand. Begin by saying that you are a teacher and you depend on the trash collector to haul away the trash from your home. Hold onto the end of the yarn and pass the ball of yarn to the trash collector in the group. Ask the trash collector to hold onto a part of the yarn and pass the ball of yarn to someone else. Continue this process, creating a web of yarn among the students.</p><br><p class="tipHeading">Tip #2</p><p>Illustrate international trade by playing a label game. Have the students form teams of 3-5 students each. Have the teams find as many goods as they can from different countries. For example, have them check the labels on their clothes. Have them list the items and the countries in which they were produced. Go over the lists with the class, and identify each country on a map. Ask, "In what ways is the world interdependent?" and "Is it good or bad to be dependent on other countries for the things we buy?"</p><br>]]></tips>
<resources><![CDATA[<p><b>Interactive tools:</b><br /></p><p><font color="#CC6666">Video</font> <a href='http://www.econedlink.org/i185' target='_blank'>Division of Labor/Specialization</a></p><p>This video teaches the concepts of Division of Labor and Specialization. The division of labor refers to the practice that the tasks of producing a good or service are divided up into separate tasks. When workers focus on performing separate tasks...<br><font size="-10"><br /></font><font size="-3">Date Published: 07/12/2012<br>Grades: 6-8, 9-12<br />Source: <a href='http://www.econedlink.org/' target='_blank'>EconEdLink.org</a></font></p><br><p><font color="#CC6666">Video</font> <a href='http://www.econedlink.org/i196' target='_blank'>Trade, Exchange and Interdependence</a></p><p>This video teaches the concept of Trade, Exchange and Interdependence. People do not make everything that they and their family use: that is, they do not grow all their own food, sew their own clothes, build their own house and provide themselves ...<br><font size="-10"><br /></font><font size="-3">Date Published: 07/12/2012<br>Grades: 3-5, 6-8, 9-12<br />Source: <a href='http://www.econedlink.org/' target='_blank'>EconEdLink.org</a></font></p><br><p><font color="#CC6666">Video</font> <a href='http://www.econedlink.org/i223' target='_blank'>Barriers to Trade</a></p><p>This video teaches the concept of Barriers to Trade. Barriers to trade are government rules that block or inhibit international trade between countries.<br><font size="-10"><br /></font><font size="-3">Date Published: 07/12/2012<br>Grades: 6-8, 9-12<br />Source: <a href='http://www.econedlink.org/' target='_blank'>EconEdLink.org</a></font></p><br><p><font color="#CC6666">Video</font> <a href='http://www.econedlink.org/i224' target='_blank'>Benefits of Trade/Comparative Advantage</a></p><p>This video teaches the concepts of Benefits of Trade and Comparative Advantage. Comparative advantage is the principle which holds that world output is higher if every country produces and trades the good in which it has a comparative advantage. ...<br><font size="-10"><br /></font><font size="-3">Date Published: 07/12/2012<br>Grades: 6-8, 9-12<br />Source: <a href='http://www.econedlink.org/' target='_blank'>EconEdLink.org</a></font></p><br><p><font color="#CC6666">Video</font> <a href='http://www.econedlink.org/i123' target='_blank'>Making Sen$e with Paul Solman: Author Says Modern Life is Good Despite Recession</a></p><p>Author Matt Ridley says life is getting better and better despite the recession. Paul Solman reports on Ridley's optimism.<br><font size="-10"><br /></font><font size="-3">Date Published: 08/19/2010<br>Grades: 9-12<br />Source: <a href='http://www.econedlink.org/' target='_blank'>EconEdLink.org</a></font></p><br><p>-------------------------------------</p><p><b>Lessons:</b></p><br><p><a href='http://www.econedlink.org/e855' target='_blank'>The Trading Game</a></p><p>In this lesson, students will learn about the gains from trade. Students will participate in a trading game that will demonstrate that trade can make everyone better off.<br><font size="-10"><br /></font><font size="-3">Date Published: 07/26/2010<br />Grades: 6-8, 9-12<br />Source: <a href='http://www.econedlink.org/' target='_blank'>EconEdLink.org</a></font></p><br><p><a href='http://www.econedlink.org/e750' target='_blank'>What Is Money? Why Does It Have Value?</a></p><p>In this lesson, students consider the fact that the value of money differs depending on where the money is being spent. In order to understand this idea, students will first develop a deeper understanding of what it means for money to have a value. They will then consider that different goods and services cost different amounts of money in different regions of the world. Finally, students develop an understanding that the value of a dollar is determined by where the dollar is spent.<br><font size="-10"><br /></font><font size="-3">Date Published: 11/26/2008<br />Grades: 6-8<br />Source: <a href='http://www.econedlink.org/' target='_blank'>EconEdLink.org</a></font></p><br><p><a href='http://www.econedlink.org/e579' target='_blank'>Fad or Fortune</a></p><p>This lesson focuses on collectibles and how they retain, lose, or gain value. In each round of a trading simulation, students will learn more about the value of their collectibles and discuss why items gain or lose value. They will record and reflect on their strategies for each round<br><font size="-10"><br /></font><font size="-3">Date Published: 10/25/2005<br />Grades: 6-8<br />Source: <a href='http://www.econedlink.org/' target='_blank'>EconEdLink.org</a></font></p><br><p><a href='http://www.econedlink.org/e478' target='_blank'>Hawaiian Economics: Barter for Fish & Poi</a></p><p>In ancient Hawaii, chiefs managed the economy by creating a land division system, the Ahupua'a, which divided the islands into pie slice shapes. Each Ahupua'a covered the three main regions of the islands: the mountains, the valleys, and the beach. This system was designed to allow all Hawaiian communities equal access to the limited natural resources of the islands. However, it took a lot of time and energy to gather and grow all these resources, which were often spread out over great distances and located at different elevations. Many Hawaiians began to specialize in fishing and farming, and soon there was a need for Hawaiians to trade with one another to receive items they were no longer growing or gathering for themselves.<br><font size="-10"><br /></font><font size="-3">Date Published: 11/10/2003<br />Grades: 3-5<br />Source: <a href='http://www.econedlink.org/' target='_blank'>EconEdLink.org</a></font></p><br><p><a href='http://www.econedlink.org/e67' target='_blank'>I Have No Money, Would You Take Wampum?</a></p><p>Through the use of folk tales, history, and the students' own experiences, students will recognize the inter-relatedness of goods, services, money. They will locate information about barter as a means of trade, use folk tales as an historical instrument.<br><font size="-10"><br /></font><font size="-3">Date Published: 12/10/1999<br />Grades: 3-5<br />Source: <a href='http://www.econedlink.org/' target='_blank'>EconEdLink.org</a></font></p><br>]]></resources>
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