APPENDIX F
 

At the completion of kindergarten, students will know the following.

Students could use this knowledge to:

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1.                  People make choices because they cannot have all the goods and services they want.

Listen to a story about a character who had to make a choice.  Identify the choice that the character, made and explain why a choice had to be made. (communication arts, K.1)

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2.                  Consumers use goods and services.

Create a body tracing labeled “(Student Name)  Is a Consumer.”  Cut pictures of goods and pictures representing services that they use and glue them to the body tracing.  Display body tracings on a wall labeled “We Are Consumers.” (art, K.2)

At the completion of first grade, students will know the kindergarten benchmarks and the following.

Students could use this knowledge to:

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1.                  Producers make goods and provide services.

Ask family members, neighbors, or friends what goods or services they produce at home or at work.  Generate a class list of producers and categorize whether the producers make goods or provide services.  Create a bar graph of the results.  (communication arts and math, 1.1)

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2.                  Whenever a choice is made, something is given up (opportunity cost).

Color two simple pictures that are printed on a single sheet of paper, one on each side.  Choose one picture to cut out and display in the classroom.  Identify the side not chosen as their opportunity cost.  Display choices on the wall, labeled “When we choose, we give up something.”  (art and fine motor skills, 1.2) 

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3.                  People save to buy goods and services in the future.

Earn 1¢ paper coin each day for work in the classroom.  Choose to purchase an item (or picture of an item) each day, priced at 1¢, or save to purchase a more expensive item (5¢ or 10¢) another day.  (communication arts and mathematics, 1.3)

At the completion of second grade, the K-1 benchmarks and the following.

Students could use this knowledge to:

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1.                  Entrepreneurs, natural resources, human resources, and capital resources are combined to produce goods and services.

Produce butter in the classroom.  Identify the natural, human, and capital resources used to produce butter.  Identify the teacher as the entrepreneur.  Explain changes in state of matter.  (communication arts and science, 2.1)

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2.                  Trade is the exchange of goods, services, and resources using barter or money.

Bring items to trade with one another, using barter.  Identify problems trading using barter, use play money to trade.  Explain that barter and money can be used for trade. (communication arts, 2.2)

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3.                  Saving is the part of income not spent and not paid in taxes.

Listen to a word problem describing a man who earned $10 raking.  The government collected $2 for taxes, and the man received $8.  He spent the rest for a new collar for his dog and saved the rest.  Compute how much he spent.  State similar word problems.  (communication arts and mathematics, 2.3)

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4.                  People pay for goods and services in different ways.

Give examples of how their family members or friends have paid for candy in a vending machine, clothes, hamburgers, heating bill, groceries, and TVs.  Include different forms of payment such as cash, check, credit card, debit card, and money order. (communication arts, 2.4)

At the completion of third grade, students will know the K-2 grade benchmarks and the following.

Students could use this knowledge to:

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1.                  People can develop their human capital and use it when they work.

Identify things that they have learned in school in the last week.  Identify jobs in which they could use those skills and knowledge.  For example, they can measure which could be used to be a carpenter or a wallpaper hanger.  They can read which could be used to be a teacher, lawyer or doctor.  Write about a job they’d like to have when they grow up and the human capital they would need. (career education and communication arts, 3.1)

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2.                  There are different methods to distribute goods and services, and there are advantages and disadvantages to each.  No method of distributing goods and services can satisfy all wants.

List ways to distribute goods that everyone in the class wants (e.g., apples) that are scarce (not enough for everyone in the classroom), including prices, teacher decides, majority rules, contests, force, first-come-first-served, sharing equally, lottery, personal characteristics, and others.  Working in cooperative learning groups, decide on a distribution method and draw a picture or symbols that depict the method.(communication arts and art, 3.2)

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3.                  Positive incentives and negative incentives affect people’s choices and behavior.

List examples of positive and negative incentives that affect students’ behaviors when riding the school bus or participating in a school assembly; or people’s behaviors regarding recycling.  (communication arts, 3.3)

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4.                  People choose to trade because they expect to be better off.

Given a musical instrument for class, such as a tambourine, rhythm sticks, or triangle, participate in a trading activity.  After the trading activity, write a paragraph describing whether they traded, and if they traded, explain why they agreed to trade.  (communication arts and music, 3.4)

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5.                                          Everyone specializes to some degree, and everyone depends on others to produce many of the things he or she consumes.

Generate a list of workers on whom they depend in their community.  Identify the goods and services these individuals produce.  Draw a picture of one person from the list.  Label the picture, “(worker’s title) produces (name of good or service).”  Create a display by placing a picture of the class in the center of a bulletin board, and by placing student drawings of workers around the class picture.  Use yarn to connect the class picture with the student drawings.  Label the bulletin board, “Community Workers on Whom We Depend for Goods and Services”  (communication arts and art, 3.5)

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6.                                          Banks, credit unions, and savings and loan associations are places where people save money and earn interest, and where other people borrow money and pay interest.

Explain the relationship between saving money and earning interest and borrowing money and paying interest, after participating in an activity in which they play the roles of savers and borrowers.  (communication arts, 3.6)

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7.                                          A budget helps people plan their spending and saving.

Plan a budget for an allowance.  The budget will include spending for goods and services, charitable donations, sales tax, and saving.  Create the budget using a spreadsheet computer application.  Explain how the budget would change if there were a change in sales tax or if there were higher prices for goods and services the students bought.  (technology, communication arts, and mathematics, 3.7)

At the completion of fourth grade, students will know the K-3 grade benchmarks and the following.

Students could use this knowledge to:

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1.                                          The opportunity cost of a choice is the value of the best alternative given up.

Write and illustrate a story in which the character must make a choice.  Identify the character’s choice and opportunity cost.  Create a class book titled, “People’s Choices Have Costs.”  (communication arts, 4.1)

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2.                                           Most decisions require trade-offs.

Analyze how to divide three hours of time on a Saturday afternoon when the possibilities are raking leaves to earn income, going roller skating with a friend, or watching television.  Create a set of index cards labeled “RL,” “RS,” and “WT.”  Use the cards to develop a set of combinations for use of the three hours.  Select one combination and explain the trade-off that is being made.  (mathematics, 4.2)

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3.                                          In markets, prices are determined when buyers and sellers interact.

Choose two students.  Assign one the role of seller and one the role of buyer.  Give the seller a small object and make up a cost for the item.  Explain the seller does not want to sell the item below his/her cost.  Give the buyer a spending limit for the item (above the cost figure given to the seller), but mention that most buyers want to spend as little as possible for the things they want.  Allow the children to negotiate a price.  (communication arts, 4.3)

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4.                                          Sellers compete on the basis of price, product quality, customer service, product design and variety, and advertising.

Choose a common product that students would purchase (backpacks, athletic shoes, drink boxes).  In cooperative learning groups, compare and contrast the features of the product.  Compare the approximate price of the product.  Orally present a critique of the products’ advertising.  Choose which of the products the group would purchase, and explain how the seller won the competition to get the group to buy its product.  (communication arts, 4.4) 

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5.                                          People can earn income by exchanging their work for wages or salaries or by receiving money as a gift.

Compile a list of classroom jobs and the wages that students would consider fair for each.  Add the number of hours each job would take per week and the wages that would be paid if a student were to have all of the jobs.  Identify the payment to the student as income.  List events for which students receive gifts of money.  Compare the reliability of income received from regular work to that received as gifts.  (communication arts and mathematics, 4.5)

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6.                                          Workers can improve their productivity by gaining new knowledge, skills, and experiences; by using capital resources; and by specializing in specific tasks.

Allow two minutes.  Start with a one-digit number.  Multiply the number by 2.  Multiply that product by 3.  Continue through 10.  Repeat activity for another two minutes, starting with the same one-digit number.  Compare progress in first round with progress in second round.  Repeat activity using calculators.  Compare progress in first, second and third rounds.  Discuss increases in productivity due to experience (round 2) and capital resources (round 3).  (mathematics, 4.6)

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7.                                          Governments provide some goods and services and pay for them with taxes collected from citizens.

Create a community map bulletin board.  Analyze the goods and services available in their community to determine that some are privately produced and governments provide others.  Explain that governments pay for the goods and services they provide with taxes.  (civics and communication arts, 4.7)

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8.                                          When people use credit, they are borrowing money.  Responsible borrowers repay as promised, showing that they are creditworthy.

Look up “worthy” in the dictionary.  Choose “deserving” as the most appropriate synonym.  Discuss the characteristics that would make someone deserving and undeserving of credit.  (character education and communication arts, 4.8) 

At the completion of fifth grade, students will know the K-4 grade benchmarks and the following.

Students could use this knowledge to:

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1.      Financial and non-financial choices that people make have benefits and costs and consequences.

Describe a spending-saving decision that they or their families made and identify the benefits, costs, and consequences of their decisions. (communication arts, 5.1)

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2.      Resources can be used in different ways to produce different goods and services.

Create and produce different goods or services using the same resources (scissors, paper, glue and so on) that teachers provide to all students.  Present the final product and describe resources used to the class. (communication arts, 5.2)

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3.                  Money is anything widely accepted as final payment for goods and services.

Identify goods and services that they might purchase using cash, check, debit card, and credit card.  Explain why use of a credit card is not final payment for a good or service. (communication arts, 5.3)

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4.      Entrepreneurs have many incentives including profit, self-employment, recognition, and creative satisfaction.

Identify entrepreneurs in American history and state the incentives for those entrepreneurs.  Interview entrepreneurs in their community and identify the entrepreneurs’ incentives.  (civics and communication arts, 5.4)

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5.      Increases in productivity result from technological change and other sources.

Measure productivity changes with and without better equipment in a classroom activity, and describe how technological change improves productivity.  Identify technological changes in the Industrial Revolution that led to increases in productivity.  (U.S. history and mathematics, 5.5)

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6.      Decisions involve trade-offs; decisions usually involve getting a little more of one thing by giving up a little of something else.

Given a budget, plan a classroom party making decisions about the quantity and quality of food, entertainment, and decorations.  Identify the trade-offs made.  (mathematics and communication arts, 5.4)

At the completion of sixth grade, students will know the K-5 grade benchmarks and the following.

Students could use this knowledge to:

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1.            Scarcity exists because there aren’t enough resources to satisfy everyone’s wants.

Given a picture of a resource, such as an acre of forested land or a lake, list possible goods and services that could be produced from the resource and explain why people can’t have all the things listed.  (communication arts, 6.1)

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2.            Scarcity requires the use of some distribution method.  In each economy, some distribution decisions are made in markets and some are made by governments.

Describe the ways that specific goods and services in their community or country are distributed, such as seats on an airplane, recreation shelters in a park, movie rentals, K-12 education, seats at a professional sporting event, and medical care.  Explain that the goods and services may be distributed differently in another country.  (communication arts, civics, and world regions, 6.2)

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3.            Voluntary exchange, such as exports and imports among people or organizations in different countries, gives people a broader range of choices.

Compare the results of rounds in a trading activity in which individual students have received a different assortment of goods that they may trade, having an opportunity to trade with more students in each round.  (communication arts and world regions, 6.3)

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4.            Standards of living increase as the productivity of labor improves.

Measure productivity changes in a production activity and relate the productivity increases to the number of goods and services available per student, thereby increasing the standard of living.  Compare standards of living in different countries.  (mathematics, communication arts, and world regions, 6.4)

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5.                              Gross Domestic Product (GDP) is a basic measure of a nation’s economic output and income.

Compare the GDP and per capita GDP of different countries, identifying relatively rich and poor countries.  (communication arts and world regions, 6.5)

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6.                              A key to financial well-being is to spend less than you earn and save the difference.

Given a budget based on income earned, choose carefully among spending alternatives to increase the amount saved and justify choices.  (mathematics and communication arts, 6.6)

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7.                              People perform basic financial tasks, such as paying bills on time and balancing a checkbook, to manage money. Some payment methods are more expensive than others.

Identify financial tasks that responsible money managers perform regularly or periodically, such as paying bills, balancing a checkbook, reviewing bills and credit card statements, and so on.  Compare the costs associated with cash, check, money order, debit, and credit payments.  (mathematics, family and consumer sciences, and communication arts, 6.7)

At the completion of seventh grade, students will know the K-6 grade benchmarks and the following.

Students could use this knowledge to:

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1.                              Responses to incentives are predictable because people usually pursue their self-interest.  Incentives can be monetary or non-monetary.

Predict that teenagers would want to work more hours if wages increased 20% in fast-food restaurants because giving up free time at a higher wage is more attractive than giving up free time at a lower wage. (careers and consumer and family sciences, 7.1)

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2.                              Compound interest is earned on both principal and previously earned interest.  The interest earned depends on time, interest rate, and amount saved.

Compute interest earned over a time period with compounding and different interest rates.  (mathematics and consumer and family sciences, 7.2)

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3.                              People’s incomes, in part, reflect choices they have made about education, training, skill development, and careers.  People with few skills are more likely to be poor.

Correlate different careers with their pay and required education.  Compare lifetime earnings for people who chose to drop out of high school with those who chose to remain in school.  (careers mathematics, 7.3)

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4.                              At higher prices, consumers tend to purchase less of a good or service.  At lower prices, consumers tend to purchase more.

Predict how consumers will respond to higher prices for a specific product.  Create a table and/or chart representing the data and describe the mathematical relationship that exists between the two variables (price and quantity).  (mathematics, 7.4)

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5.                              At higher prices, producers tend to produce more of a good or service because it is more profitable.  At lower prices, producers tend to produce less.

Explain that an automobile manufacturer would be willing to produce and sell more cars if the cars could be sold at higher prices because the automobile manufacturer could earn more profit.  (communication arts, 7.5)

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6.                              Many workers receive employee benefits in addition to their pay.

Identify an array of possible employee benefits, such as medical insurance and sick leave, and explain why employers might provide these benefits. (careers, consumer and family sciences, and communication arts, 7.5)

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7.            Wages/salaries minus payroll deductions equals take-home pay.

Given a sample payroll statement, compute the percentage of income withheld for various payroll deductions, such as FICA, income taxes, and insurance contributions. (mathematics, careers, and consumer and family sciences. 7.6)

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8.            Financial investment products differ in their potential rate of return, liquidity, and level of risk.

Conduct research on different financial investment products and identify the associated expected rate of return and the level of risk.  (consumer and family sciences, 7.7)

At the completion of eighth grade, students will know the K-7 grade benchmarks and the following.

Students could use this knowledge to:

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1.                                                            Many nations employ trade barriers for national defense reasons or because some companies and workers are hurt by free trade.

Identify examples of trade barriers imposed on products following the Revolutionary War and prior to the Civil War.  Analyze the reasons given for imposing these barriers and the impact of these barriers on different groups in the United States.  Identify products on which the United States currently imposes barriers to trade, and explain which groups might support the imposition of these barriers and why.  (8.1, United States history and communication arts)

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2.                                                            More productive workers are likely to be of greater value to employers and earn higher wages than less productive workers.

Decide which workers to hire and explain the hiring decisions, given a list of job applicants with different levels of productivity.  Look at productivity data and wages for the United States from 1900 to 2000.  Explain the relationship that exists between the two sets of data. (communication arts, mathematics, United States history, 8.2)

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3.                                                            If a good or service cannot be withheld from those who do not pay for it, providers expect to be unable to sell it and therefore will not produce it.  In market economies, governments provide some of these public goods.

Explain why a private firm would not provide flood protection in a community or national defense for the country.  Explain why, in market economies, shoes are provided by private firms.  Answer the following question: If the national, state, and local governments had no power to tax, what goods and services would citizens have to do without?  (civics and communication arts, 8.3)

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4.                                                            Most federal tax revenue comes from personal income taxes and payroll taxes and is spent on public goods and transfer payments.

Use data from the U. S. federal budget to construct two pie charts – one representing major categories of federal revenue and one representing major categories of federal expenditures.  Write sentences describing revenue and expense categories, such as personal income tax is a major source of revenue for the United States government.  (civics, mathematics, and communication arts 8.4)

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5.                                                            Most state and local government revenues come from sales taxes, grants from the federal government, personal income taxes, and property taxes.  These revenues are spent for education, public welfare, road construction and repair, and public safety.

Use data from a state or local budget to construct two pie charts – one representing major categories of state or local revenue and one representing major categories of state or local expenditures.  Write statements comparing the various sources of state and local revenues and various categories of state and local expenditures with those for the U. S. federal government.  For example, most local revenue comes from sales tax; no federal revenue comes from sale tax. (civics, mathematics, and communication arts, 8.5)

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6.                                                            Inflation reduces the purchasing power of income and the value of the return on a financial investment.      

Use an on-line inflation calculator to compare the price of a market basket of goods in 1980 with the price of the same market basket of goods today.  Explain that inflation reduces purchasing power for people whose income is either fixed or increasing slower than the rate of inflation.  Explain how inflation affects investment returns.  (technology and communication arts, 8.6)

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7.                                                            When unemployment exists, an economy’s production is less than it could be.

Draw a flow chart or other diagram that illustrates the ripple effect of unemployment in a particular industry or community.  (communication arts and civics, 8.7)

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8.                                                            Government transfer payments provide unearned income to some households.

Give examples of government transfer payments, such as reduced-price school lunches and social security survivors’ benefits.  Identify problems or concerns in U. S. history that led to the development of these programs.  (communication arts, civics and U. S. history, 8.8)

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9.                                                            Laws and regulations exist to protect consumers from a variety of seller and lender abuses.

Conduct research to identify examples of abuses, such as fraud, false advertising, or the sale of faulty products that have occurred in United States history.  Identify consumer protection laws and regulations that were developed to address these problems.  (U. S. history, civics and language arts, 8.9)

At the completion of eleventh grade, students will know the K-8 benchmarks and the following:

Students could use this knowledge to:

EC/PF

1.                                                            The evaluation of choices and opportunity costs is subjective; such evaluations differ across individuals and societies.

Explain the criteria they have used in making a decision and identify the opportunity cost of their decision.  Explain why different people, when faced with a similar problem, choose different solutions to the problem.   (communication arts, 11.1)

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2.                                                            As long as the extra benefit of an activity exceeds the extra cost, people are better off doing more of it; when the extra cost exceeds the extra benefit, they are better off doing less of it.

Apply cost-benefit analysis to explain why the FDA has regulations that allow a certain amount (parts per million) of rodent hair in candy bars or why the FDA allows up to 30% of ground coffee to consist of unripe, moldy beans.  Apply cost-benefit analysis to the decision to “supersize” lunch at a local fast-food restaurant.  (civics, consumer and family sciences, and communication arts, 11.2)

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3.                                                            Trade barriers have costs, benefits and consequences, such as limited product choice, protection of some jobs, and higher consumer prices, respectively.

Analyze the costs, benefits and consequences of past policies of the U. S. government that imposed trade barriers or the costs, benefits and consequences of a proposed quota or tariff on a foreign product.  (U. S. history, civics,  and communication arts, 11.3)

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4.                                                            Two factors that prompt international trade are comparative advantage and international differences in the availability of productive resources.  These factors can change over time.

Identify two goods, such as bananas and coffee, that could be produced in the continental United States, although production would be very costly, and explain in terms of opportunity cost why the United States is probably better off importing such goods.  (communication arts, 11.4)

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5.                                                            Market prices are determined by the interaction of demand and supply.  Market prices change as a result of changes in demand or supply.

Participate in a market simulation activity.  After participating, identify equilibrium price, and explain what happens in a market when a surplus or shortage exists.  Explain the impact of changes in supply or demand on market price.  (mathematics and communication arts, 11.5)

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6.                                                            Effective price ceilings cause persistent shortages and effective price floors cause persistent surpluses.

Review historical examples of wage and price controls in the United States.  Analyze the consequences of these price controls.  (U. S. history and communication arts, 11.6)

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7.                                                            Labor unions represent some workers in negotiations with employers involving wages, employee benefits, and work rules.

Explain the historical role of labor unions in changing working conditions and wages in the United States.  Visit the AFL-CIO website to identify examples of present-day labor unions that operate under the umbrella of the AFL-CIO and current issues about which present-day unions are concerned.  (U. S. history and communication arts, 11.7)

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8.                                                            Riskier loans command higher interest rates than safer loans because of the greater chance of default on the repayment of risky loans.

Explain why there are usually differences in interest rates for new and used-car loans, for 15-year versus 30-year mortgages, and for individuals with good and bad credit ratings.  (consumer and family sciences and communication arts, 11.8)

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9.                                                            Higher interest rates encourage saving and discourage borrowing for consumers and businesses.

Explain how changes in interest rates affect people’s decisions to buy cars and houses.  Explain how differences in interest rates affect people’s decisions to place savings in a savings account or a certificate of deposit.   (consumer and family sciences and communication arts, 11.9)

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10.                                                        Changes in the prices for productive resources affect the combination of those resources used by firms.

Use a flow chart to analyze the impact of minimum wage on the combination of resources used by firms throughout U. S. history.  For example, with increases in minimum wage, some firms employed fewer unskilled workers and used more capital and some firms chose to hirer older workers rather than younger works.  (U. S. history, government, communication arts, 11.10 )

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11.                                                        Government tax and regulatory policies influence the decisions of individuals and businesses.

Analyze the impact of changes in tax policy on the saving behavior of individuals and on the investment decisions of businesses.  Review the development of regulatory agencies and policies in the United States.  Analyze the impact of these regulations on the production and consumption of various goods and services.  (U. S. history, civics, communication arts, 11.11)

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12.                                                        Productivity increases and economic growth result from investment in human capital and capital resources, research and development, technological change, and improved institutional arrangements and incentives.

Analyze per capita real GDP data for several periods in history, identifying periods during which the United States experienced rapid economic growth.  Explain factors that contributed to this growth.  (U. S. history and communication arts, 11.12)

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13.                                                        Historically, economic growth has been the primary vehicle for alleviating poverty and raising standards of living.

Compare the material standards of living of individuals living in the United States in 1790, 1890, and 1990; explain the relationship between higher productivity levels, new technologies, and the standard of living.  (U. S. history and communication arts, 11.13)

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14.                                                        Markets tend to allocate resources effectively unless (1) property rights are not clearly defined or enforced, (2) significant externalities exist, (3) markets are not competitive, or (4) consumers can be free riders.

Identify at least three economic roles of the U. S. government and cite a specific example of each.  Explain how assignment and enforcement of property rights might be used to alleviate a pollution problem.  Explain why the federal government subsidizes medical research.  Review the history of anti-trust legislation and explain how the legislation promotes competition.  Explain why national defense is not provided privately.  (U. S. history and civics, 11.14)

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15.                                                        The potential level of GDP for a nation is determined by the quantity and quality of its natural resources, the size and skills of its labor force, and the size and quality of its stock of capital resources.

Compare the quantity and quality of natural resources, the size and skills of the labor force, and the size and quality of the stock of capital resources in two countries.  Explain how these factors might affect the ability of each country to increase its GDP.  (world regions and communication arts, 11.15)

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16.                                                        Unexpected inflation hurts savers and people on fixed incomes; it helps people who have borrowed money at a fixed rate of interest.

Explain who would be harmed by and who would benefit from an unexpected rise in inflation and why.  Identify periods in U. S. history during which the economy experienced unexpected inflation, and explain how unexpected inflation affected the spending, saving, and borrowing decisions of individuals and businesses. (U. S. history, civics, consumer and family sciences 11.16)

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17.                                                        The federal government may have a balanced budget, budget deficit, or a budget surplus.  Accumulated deficits make up the national debt.

Explain whether the federal budget is in surplus, in deficit, or balanced.  Analyze historical federal budget data to identify time periods during which the federal budget was in deficit or in surplus.  Explain that the federal debt is financed through the sale of government securities.  (U. S. history, civics and communication arts11.17)

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18.                                                        Changes in monetary policy by the Federal Reserve System lead to changes in the money supply and the availability of credit.

Write an article for the business section of a newspaper explaining what monetary policy is and how changes in monetary policy affect the money supply and interest rates.  Explain how the Federal Reserve System affects monetary policy.   (civics and communication arts 11.18)

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19.                                                        Changes in fiscal policy affect the nation’s overall level of employment, output and prices.

Identify historical examples of changes in fiscal policy and explain whether these changes were adopted to influence levels of output, employment, prices or all three.  Outline the fiscal policies they would recommend to correct one of the following: 1) rising unemployment or (2) rising inflation, and explain the recommendation.  (U. S. history, civics  and communication arts, 11.19)

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20.                                                        The wage/salary paid for a given job depends on a worker’s skills and education, plus the importance of the work to society and the supply of and demand for qualified workers.

Review wage and education data, and explain the connection between education levels and lifetime income.  Visit the Bureau of Labor Statistics website and review occupational outlook data to identify jobs that are likely to be in demand in the future.  Identify the education and training required to obtain one of these jobs.  (careers, technology and  communication arts, 11.20)

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21.                                                        Social Security and Medicare provide insurance against some loss of income and benefits to eligible recipients.

Explain when and why Social Security and Medicare programs were established in the United States.  Describe some of the benefits recipients are eligible to receive.  Determine the amount of Social Security and Medicare deductions required by a worker earning a given income.  (U. S. history, consumer and family sciences, communication arts, 11.21)

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22.                                                        People pay taxes on many types of income, such as wages or salaries, interest, dividends, capital gains, tips, commissions and profit from a self-owned business.

Identify those items that should be included when calculating gross income for an individual filing a federal income tax form.  (consumer and family sciences, communication arts, 11.22 )

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23.                                                        Deductions, exemptions, and tax credits reduce taxable income. 

Review a tax return identifying examples of tax deductions, tax credits, and personal exemptions.  Given data regarding a fictitious individual taxpayer, complete a 1040 form.  Visit the IRS website and review examples of legal tax deductions.  (consumer and family sciences, technology, 11.23)

24.                                                        Employer-sponsored savings plans provide many advantages to workers.

Analyze the effect of an employer-sponsored, retirement savings program on a worker’s current and future income.  (consumer and family sciences, 11.24)

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25.    Risk management strategies include risk avoidance, risk control, and risk transfer through insurance.

List ways in which a young person can avoid risk.  Describe types of insurance, including life, health, disability, and property insurance, and gather information on an auto insurance plan to meet the needs of a teen-age driver.  (consumer and family sciences, communication arts, 11.25)

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26.    A personal financial plan includes financial goals, a net worth statement, an income and expense record, an insurance plan, a saving plan, and a budget.  Financially responsible individuals accept the fact that they are accountable for their financial future.

Design a personal financial plan for a young person living away from home.  Explain how the young person would have to adapt the plan if his or her income were reduced.  List specific ways that young people can demonstrate financial responsibility.  (consumer and family sciences, character education, communication arts, 11.26)

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27.    Legal contracts can be an important part of financial planning.

Give examples of legal contracts, such as wills, credit card disclosure statements, car loan disclosure statements, and so on.  Explain the importance of reading these documents carefully in order to understand the full implications of the agreement.  (consumer and family sciences, law and government, 11.27)

PF

28.  For any given loan amount and interest rate, the longer the loan period, the smaller the monthly payment and the larger the total cost of credit. Making minimum payments on credit card balances increases the total cost and repayment time.

Compare interest rates, loan periods, monthly payments, and total cost of credit for various car loan options.  Calculate how long it takes to repay credit card debt and the total cost when a borrower makes minimum payments.  (mathematics, technology, communication arts, consumer and family sciences,  11.28)

PF

29.    Credit bureaus maintain credit reports, which record borrowers’ histories of repaying loans.  Negative information in credit reports can affect a person’s financial future.

Explain the value of credit reports to borrowers and lenders.  Explain the affect of negative information in a credit report on a person’s financial future.  Explain where a consumer can obtain a copy of his or her credit report.  (communication arts and consumer and family sciences, 11.29)

PF

30.    There are consequences when people borrow more money than they are able to repay.  Consumers with excessive debt have a number of options.  Bankruptcy provides debt relief, but has serious negative consequences.

List possible actions a consumer could take in response to excessive debt, such as renegotiating a repayment schedule or selling assets, and their consequences.  Describe the negative consequences of bankruptcy, such as the increased difficulty of getting credit in the future.  (consumer and family sciences, communication arts, law and government, 11.30)

PF

31.    Leasing, borrowing to buy, and rent-to-own options have different contract terms and costs.

Compare the total costs of leasing, borrowing to buy, and rent-to-own options.  (mathematics, consumer and family sciences, 11.31)

PF

32.    Tax-exempt and tax-deferred financial investments significantly increase an investor’s total return over time.

Explain the difference between tax-exempt and tax-deferred financial investments, and compare the returns of taxable investments with those that are tax-exempt or tax-deferred.  (consumer and family sciences, communication arts, 11.32)

PF

33.    Wealth increases with regular saving, time, and frequent compounding.

Compare the amounts accumulated, given different times, rates of return, and frequencies of compounding.  (consumer and family sciences, mathematics, 11.33)

PF

34.    Diversification reduces risk by spreading assets among several types of financial investments and industry sectors.

Compare the risk and return of different types of saving and financial investment products and combinations of such products over time.  (consumer and family sciences, communication arts, 11.34)