Economics

Economics includes the study of production, distribution, and consumption of goods and services.  Students need to understand how their economic decisions affect them, others, and the nation as a whole.

Academic Expectation 2.18:  Students understand economic principles and are able to make economic decisions that have consequences in daily living.

Elementary
(Assessment at Grade 5)

Middle Level
(Assessment at Grade 8)

High School
(Assessment at Grade 11)

The basic economic problem confronting individuals and societies is the scarcity or imbalance between unlimited wants and limited resources available for satisfying those wants.

SS-E-3.1.1

Scarcity requires people to make choices about using goods, services, and limited resources.

SS-E-3.1.2

Consumers use goods and services to satisfy economic wants and needs.

SS-E-3.1.3

Every time a choice is made, an opportunity cost is incurred. Opportunity cost refers to what is given up when an economic choice is made.

SS-M-3.1.1

Productive resources (land, labor, capital) are limited and do not satisfy all the wants of individuals, societies, and governments (scarcity).

SS-M-3.1.2

To make informed choices, consumers must analyze advertisements, consider personal finances, and examine the opportunity cost.

SS-H-3.1.1

Scarcity of resources necessitates choices at both the personal and societal levels.

SS-H-3.1.2

Federal, state, and local governments have limited budgets, so they must compare revenues to costs when planning public projects.

SS-H-3.1.3

To make informed choices, consumers must analyze advertisements, consider personal finances (including the importance of savings, investment, and use of credit), and examine opportunity cost.

To deal with the problem of scarcity, people and societies create economic systems and institutions.

SS-E-3.2.1

Economic systems can be large (e.g., U.S. economy) or small (e.g., individuals and households).

SS-E-3.2.2

The U.S. economic system has financial institutions (e.g., banks).

SS-E-3.2.3

The U.S. economic system is based on free enterprise where businesses seek to make profits by producing or selling goods or services.

SS-E-3.2.4

Profit is the difference between revenues and the costs entailed in producing or selling goods or services.

SS-M-3.2.1

Economic systems include traditional,

command, or market.  Modern economies use a “mixed system” that has features of all three.

SS-M-3.2.2

The hope of earning profit motivates businesses to take the risks involved in producing goods and services.

SS-H-3.2.1

Economic systems can be evaluated by their abilities to achieve broad social goals such as freedom, efficiency, equity, security, and growth.

SS-H-3.2.2

Economic institutions include such organizations as corporations, labor unions, banks, stock markets, cooperatives, and partnerships.

SS-H-3.2.3

Individuals attempt to maximize their profits based on their role in the economy (e.g., producers try to maximize profit, workers try to maximize income, savers and investors try to maximize return).

Markets are institutional arrangements that enable buyers and sellers to exchange goods and services.

SS-E-3.3.1

A market exists whenever buyers and sellers exchange goods and services. Prices and availability of goods and services are determined by supply and demand.

SS-E-3.3.2

The direct exchange of goods and services is called barter.  Money has generally replaced barter as a more efficient system for exchange.

SS-M-3.3.1

Prices of goods and services are determined by supply and demand.  The market price is reached when quantity supplied equals quantity demanded.  

SS-M-3.3.2

Money (unit of account) can be used to express the market value of goods and services.  Money makes it easier to trade, borrow, invest, and save.

SS-M-3.3.3

Competition among buyers and sellers impacts the price of goods and services.

SS-H-3.3.1

Numerous factors influence the supply and demand for products (e.g., supply - technology, cost of inputs, number of sellers; demand - income, price of similar products, consumers’ preferences).

SS-H-3.3.2

Specific financial and non-financial incentives often influence individuals differently (e.g., discounts, sales promotions, trends, personal convictions).

SS-H-3.3.3

The level of competition in a market is largely determined by the number of buyers and sellers.

SS-H-3.3.4

Laws and government mandates (e.g., anti-trust legislation, tariff policy, regulatory policy) have been adopted to maintain competition in the United States.

All societies deal with questions about production, distribution, and consumption. 

SS-E-3.4.1

Producers create goods and services; consumers make economic choices about which ones to purchase.

SS-E-3.4.2

The government provides goods and services (e.g., police force, fire fighting, education, food surpluses) and pays for them with taxes.  Private businesses offer similar goods and services (e.g., security guards, private schools, grocery stores) for profit.

SS-E-3.4.3

Producers who specialize create specific goods or services (e.g., computer games, tennis shoes, movie theatres).

SS-M-3.4.1

The basic economic issues addressed by producers are production, distribution, and consumption of goods and services.

SS-M-3.4.2

Productivity can be improved by specialization, new knowledge, and technology/tools. 

SS-M-3.4.3

Personal, national, and international economic activities are interdependent.

SS-H-3.4.1

An entrepreneur is a person who organizes and manages a business and/or enterprise usually with considerable initiative and risk.

SS-H-3.4.2

Technological change and investments in capital goods and human capital/resources increase productivity.

SS-H-3.4.3

Investments in capital goods and labor can increase productivity but have significant opportunity costs.

SS-H-3.4.4

The interdependence of personal, national, and international economic activity often results in international issues and concerns (e.g., natural resource dependencies, economic sanctions, environmental and humanitarian issues).