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Grade: Elementary

#2343. "Economics makes Cents" UNIT for third graders

Social Studies, level: Elementary
Posted Fri Aug 17 21:06:00 PDT 2001 by Vickie DeBruin (UVT03@rockwood.k12.mo.us).
Uthoff Valley, Fenton, MO
Materials Required: per lesson
Activity Time: about 45 minutes per lesson
Concepts Taught: learning economics terms

Economics Makes Cents
By Vickie DeBruin
Teacher's Academy 2000-2001

Teaching third grade in a self contained setting lends itself quite well to educating students through interdisciplinary units. The elementary classroom setting is a unique opportunity for teachers to do this seeing as they are the provider of instruction for all academic areas for their students. Often we underestimate the impact of learning when student experiences occur through different kinds of activities involving diverse kinds of learning. After completing graduate work consisted of writing a curriculum that utilizes many multiple intelligences, I wanted to take one of our social studies units and expand it to various experiences within other academic areas thereby applying it to students multiple intelligences. I challenged myself to do this with our third grade economics unit.
The best place to start was with our districts economics objectives. These objectives are derived from the Missouri Show Me Standards by a committee of teachers and district coordinators. The objectives I specifically targeted for this interdisciplinary unit were as follows:
Learn applications of the following terms: wants and needs, public goods, private goods, and services, opportunity cost, scarcity, savings and banks, natural, capital and human resources.
Students will create a cost benefit analysis chart for solving a problem.
Students will identify economics principles in real life situations.

These terms and principles are very complex which made it a challenge to create situations that were tangible for this age group. Teaching economics in a situational setting led to integrating social studies with other academic areas such as math, language, and science. Our third grade team integrated our economics unit into the regular curriculum with the following activities.
To begin the unit we reviewed wants and needs by tying it into our habitats unit that we had previously studied in science. Galileo is our class pet hamster. I brought in several objects (his wheel, clear tubes to crawl in, food, water, bowl, paper towel tube, wood shavings, peanut butter, etc.) and laid them on the table. I reminded students of the basic needs of all living things and then asked students to classify these items into wants and needs. Most items were easily grouped, but there were a few that were more challenging. Students struggled with wood shavings and peanut butter stating that peanut butter was food that the hamster liked. I played devil's advocate saying that he could eat the pellet food instead. The students finally decided that since it was food and food was a basic need that it should remain in that category. The wood shavings were also a debate. I said that he must have them in order to be comfortable in his shelter. Some students said that basic needs are not for comfort, but survival. By doing this activity and working through the "gray" area students went beyond simple definitions of terms they probably already knew. Most of the students combined their schemata of science with new economic principles and took that to the analytical level of Bloom's taxonomy. We then drew our conclusions to how this relates to our own lives and choices. While food is a necessity, eating out at a five star restaurant is not. While having clothes is also a need, having Nike shoes is not. Since money is limited this leads to some choices after you have paid for your basic needs.
This led directly to the idea of opportunity cost and their own spending. Students were asked to quickly draw a picture of their favorite breakfast and dinner. Some students drew simple pictures of a bowl of cereal. One student drew an elaborate picture of pancakes, sausage, orange juice, scrambled eggs and hot cocoa. I asked how many of them ate nightly snacks. They had to look at these pictures and create a shopping list of the items they might need to cook this meal and then think of other meals for the week. Next, I created a reasonable price list of common grocery store items (some necessity and some frivolous). Students were given $20 to buy groceries for the week for two meals a day (breakfast and lunch) and any snacks they might want. Students looked at their pictures and most were astonished at all the groceries they had to buy. Two of my more creative students asked if they could pool their money together to have $40 for the week and split things like milk and eggs. They were encouraged to try their plan (they didnt realize they had just made the math component of this lesson more complex as well by having to divide everything in half). I added one more factor to this authentic math/economics problem-coupons. If students wanted to clip coupons out of the paper and bring them in they could deduct that towards their savings. After a little work and most students falling short of cash for their hungry bellies, we discussed opportunity cost. One student said, If I eat just pancakes and no eggs, then Ill have money to buy chips for my snack. Another student was seen adding up the cost of coupons to try to get orange juice and milk for breakfast. Students quickly grasped the idea of trading off something they want for something they want even more. Not to mention, they had the practice of adding money up to $20 without going over and subtracting coupons. We finally made a decision tree (a basic T chart) of the pros and cons of different purchasing scenarios.
We then had the difficult task of distinguishing between the three types of resources. We had studied natural resources in science so that was an easy review. To make this task easier, I turned to stories that had examples. We started with The Sea Breeze Hotel. In this story a small hotel business is failing because of high winds on their ocean front property. The owners' grandchild begins making kites in his free time. In no time people are flocking to stay at the Sea Breeze Hotel because of the beautiful kites. We made a three column chart with Natural, Capital, and Human resources across the top. We reread the story and added all the details into the appropriate sections. In the story there were many natural resources such as the wind, wood for the kites, etc. There were fewer capital resources being the saws and tools the boy used to make the kites and the sewing machine the grandma used to sew the cloth. The human resources were the jobs of each of the characters: housekeeper, accountant, groundskeeper, and greeter. Because of the duplicity of the story, I also wove scarcity into the discussion. In the beginning there was a scarcity of customers. To solve this "scarcity problem" the boy and his grandparents created something desirable so that people would want to come there. Students then thought about a time when they had a scarcity problem and wrote their own scarcity stories, as we call them. Once they had a basic scarcity problem written down, we created a web of ways to solve the problem using our opportunity cost decision tree. Students then chose one way to solve the problem and concluded their story with that. When we typed the stories, we made a legend at the bottom of the title page where each color of print stood for a different type of resource. So human resources were typed in green, natural resources were typed in red, and capital resources in blue. This way at quick glance I could check that students had an understanding of the three resources. We read other literature while writing our stories to reinforce these concepts: Once Upon a Company, Take Me Out To The Bat and Ball Factory, and Little Nino's Pizzeria. We also had a guest speaker from Ralston-Purina come and talk about her job and how different types of resources are used in the production of pet food. Students were encouraged to find economic principles in the books they were reading for silent reading later that day. A few students were able to apply that knowledge.
The idea of goods and services is taught to our students in the previous grade, but we feel we need to review those economic terms. Students made a "to do" list with their parents of weekend errands (grocery store, dry cleaners, haircut, Wal Mart, mall, etc.). The students took this list with them on a clipboard and shadowed their parents on a Saturday errand run. Students documented what was purchased, whether it was a good or service and the estimated cost. When they brought this information back to school, each student made his or her own bar graph of money spent on goods and services. We then analyzed the trends of spending (was more spent on goods or services and why?). We also looked at the type of goods and services purchased. We asked each student to find one good or service they bought that was something everyone could use (in other words, a public good). Generally, most students spent on private things. We introduced the notion of public goods by treating them as private. For example, how much money does the fire department charge you to put out a fire in your house? How much money did you pay to borrow a book from the county library? Did you get your bill for having a Mayor yet? Taxes pay for these items that are then generally free to all members of a community. So there are some things that you don't have to make a list to remember to buy, but are there for everyone who needs them. In addition, we took a walk to see the public and private goods around us as described below.
As a culmination to our unit students were allowed an opportunity to participate in a buying expedition and use the principles listed above. Throughout this unit, students earned "Bunny Bucks" (small tickets) for doing jobs, exhibiting good behavior, etc. They wrote their name on their Bunny Buck and put it in their Bunny Bank (envelope) and kept it safe in their desk. They were told at the beginning that these bucks would be used to buy something. On the final day, I set up cups, a bucket of dirt, and about 7 types of seeds (compliments of a Wal Mart donation to our school). Students counted their bucks and knew what they had to spend. I put a price on each type of seed: 10 BB (Bunny Bucks) for the all time favorite Watermelon seed, 8 BB for Sunflower (second favorite to most), 6 BB for a Marigold seed, 4 BB for a Cucumber seed, 3 BB for a Petunia seed, 2 BB for a tomato seed, and 1 BB for a dill seed. I explained that there was only one packet of each type of seeds so if someone wanted to outbid a customer, they could (supply and demand). As luck would have it-this did not happen and everyone got what they wanted. Students were also told to allow 2 BB for sales taxes. We had previously taken a walk at free recess and looked around us for private goods (playground balls, personal items, teachers cars in the parking lot, etc.) and public goods (the school, a nearby fire station, a police car shooting radar, sidewalks and streets). The public goods are purchased using revenue from taxes otherwise we would not have these items and services.
One by one students came up and bought seeds with their Bunny Bucks, paying their portion of the tax. It was interesting to watch students use the cost benefit analysis we learned. I heard students say, "If I buy one watermelon seed with my money and it doesn't bloom, I wasted my money" and "I want to buy tomatoes because they will make something I can eat and flowers can't". I explained that their cup and dirt were paid for with their taxes and that all students would get a cup with dirt to plant their seeds in. Upon reflection, I could have also added that students who lived in the central portion of the room will pay 3 BB tax and get two cups of dirt since they live in a more exclusive and affluent part of the classroom. The seeds were the private goods and the cups of dirt were the public goods. We then predicted when the seeds would sprout and made a pictograph for each kind of seed and its estimated sprout date. We observed our plants (a scientific process skill) every other day and began to measure their growth once they sprouted. We then plotted the growth heights on a line graph. In the end, students took their plants home.
This type of learning is hard to assess with a pencil paper test. We instead borrowed a performance module (which is the basis for the M.A.P. tests students take for the state of Missouri) from our district curriculum document. Students did amazingly well on this module that had similar situations of economic principles. When graded using the scoring rubric also provided, all students scored above an 80%. Approximately half of the class received a full 100%. Students seemed to enjoy being actively involved in the unit and its activities which as any teacher knows is the basis to retaining knowledge. Economics makes cents after all.