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Master Curriculum Guide: Teaching Stategies 5-6
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LESSON 2
What? How? For Whom?
1. FOCUS
St udent Object ives
• Define an economic syst em as t he way people or ganize t he pr oduct ion and
dist r ibut ion of goods and ser vices.
• St at e and explain t hr ee basic quest ions ever y economic syst em must answer :
What t o pr oduce? H ow t o pr oduce? F or whom t o pr oduce?
Backgr ound
An e c o n o m ic s y s te m is t he way societ y or ganizes t he pr oduct ion and consumpt ion of goods and ser vices. E ver y economic syst em answer s t hr ee ba s ic
e c o n o m ic qu e s tio n s : What t o pr oduce? H ow t o pr oduce? and F or whom t o
pr oduce? H ow a societ y answer s t he t hr ee basic economic quest ions det er mines
t he societ y’s economic syst em.
H ist or ically, t her e ar e t hr ee t ypes of economic syst ems—t r adit ion, command,
and mar ket (pr ice) syst em. These economic syst ems answer t he basic economic
quest ions in differ ent ways. I n an economic syst em based on t r adit ion, decisions
ar e based on past behavior . I n a command economy, decisions about pr oduct ion
and consumpt ion ar e made by a cent r al planning unit , such as t he gover nment .
A mar ket (pr ice) syst em answer s t he basic economic quest ions in t he mar ket place. A m a rk e t e c o n o m y is an economic syst em wher e most goods and ser vices and r esour ces ar e exchanged t hr ough t r ansact ions by households and businesses. Most economies cont ain some feat ur es of all t hr ee syst ems, because a
mixt ur e best sat isfies t he economic goals of a societ y (such as economic fr eedom,
equit y, and economic secur it y).
Concept s
E conomic syst em, basic economic quest ions
2. PREPARE
N ewspaper s
St apler s
Scissor s
R uler s
Mar ker s
1.
F or each gr oup of four or five st udent s, collect a lar ge supply of newspaper s,
a pair of scissor s, a mar ker , st apler , and r uler .
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3. TEACH
I nt r oduct ion
This lesson may require
two class periods.
E xplain t o st udent s t hey ar e par t icipant s in an economic syst em. Today t hey
will lear n what an economic syst em is and what t hr ee quest ions ever y economic
syst em answer s. This will be accomplished by wor king in small gr oups t o simulat e an economic syst em. Gr oups will decide what good t o pr oduce wit h given
r esour ces, how t o pr oduce it , and who will r eceive t he finished pr oduct .
Act ivit ies
Students may use the
five-step decision-making
process introduced in
Lesson 1 to decide what
good to produce.
This is an opportunity for
students to be creative and
have some fun in class. One
clever group of students
created a Statue of Liberty
costume and then modeled
it for the class.
1. Divide t he class int o gr oups of four or five st udent s. Dist r ibut e newspaper s,
r uler s, st apler , scissor s, and mar ker t o each gr oup. Allow t ime for gr oups t o
make a decision about what good t o pr oduce wit h t heir r esour ces. Ot her
r esour ces may not be used.
2. Aft er a gr oup decision has been made, inst r uct each gr oup t o make one pr ot ot ype (sample) of it s good. The gr oup should fir st decide how t o pr oduce it s
good. E xplain t hat soon gr oups will have a full pr oduct ion per iod t o pr oduce
t heir goods.
3. Allow t ime for gr oups t o wor k and t hen show t heir pr ot ot ypes t o t he class.
4. R eplenish supplies of newspaper s, but do not give st udent s addit ional r uler s,
st apler s, scissor s, or mar ker s.
5. Allow a 10-15 minut e pr oduct ion per iod for gr oups t o pr oduce as many of
t heir goods as possible. Do not give assist ance or encour age compet it ion.
6. At t he end of t he pr oduct ion per iod, collect mat er ials and place all complet ed
goods on a t able for display. Wr it e t he name of each gr oup’s good on t he
boar d and r ecor d t he number pr oduced.
7. Ment ion t hat a pr oblem exist s. L ooking at t he number of complet ed it ems on
t he boar d, t ell each gr oup it has not pr oduced enough for ever yone who
want s one t o have one. F or example, 20 paper air planes might have been pr oduced by one gr oup, but t her e might be 25 people who want an air plane.
8. Discuss ways st udent s can decide who will get t he pr oduct s t hey have pr oduced. (The pr oduct s could be given t o t he t allest people, smar t est people,
most impor t ant people, best fr iends, r ichest , neediest , and so on.) E ncour age
as many diver se suggest ions as possible even if t hey ar e impr act ical. L ist
suggest ions on t he boar d.
9. E xplain t hat t hese ar e all possible ways t o allocat e or dist r ibut e t he goods
which have been pr oduced.
Students may use the fivestep decision-making
process introduced in Lesson
1 to decide how to allocate
the goods they produced.
Ask the class to think about
criteria that might guide
them in selecting an
allocation method.
8
10. Allow t ime for each gr oup t o decide which met hod of allocat ion it will use and
t ell t he class. Discuss:
• Who will benefit fr om your allocat ion met hod and who will suffer ?
• Do you t hink one allocat ion met hod is fair er t han anot her ?
• Besides pr oducing mor e, is t her e any way for ever yone t o be sat isfied? (no)
• What t hr ee quest ions did each gr oup have t o answer dur ing t his lesson?
(What t o pr oduce? H ow t o pr oduce? F or whom t o pr oduce?)
11. E xplain t hat by answer ing t he quest ions of What ? H ow? F or whom? each
gr oup for med an e c o n o m ic s y s te m . Define an economic syst em as t he way
people decide t o or ganize pr oduct ion and consumpt ion.
4. CONNECT
Co m m u n ity Co n n e c tio n . I nvit e someone fr om anot her count r y t o your class
t o discuss t hat count r y’s economic syst em and how decisions ar e made r egar ding
t he t hr ee basic economic quest ions.
La n g u a g e Arts . H ave st udent s wr it e a par agr aph suggest ing ways t o allocat e
t he limit ed goods pr oduced by t he class. Be sur e t hey addr ess t he issues of who
will benefit most , who will suffer most , and which allocat ion met hod seems fair est
and why.
N e w s p a p e r Co n n e c tio n . F ind ar t icles about count r ies in t he pr ocess of changing t heir economic syst ems, such as China, R ussia, and ot her for mer Soviet count r ies. Discuss t he pr oblems t hese count r ies face.
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