Lesson 9
The Basic questions: what, how, and for whom?
What goods and services should be produced?
How should these goods and services be produced?
For whom is the benefit of these good and services being produced?
Objectives:
Students will be able to:
1)recognize the three basic economic questions what, how and for whom
2)explain how the three basic economic questions are answered in capitalism
Activities:
1) Warm-Up: Given scenario: You inherit one million dollars. You are given the
choice to open a business to offer a good or service. What do you produce? How
are you going to produce these goods (labor, materials, resources)? For whom
is the benefit of these goods and services being produced?
2) Basic questions of what, how, and for whom?
a) Students will identify five personal items their parents buy that they would
not want. What would happen to a store that wanted to sell to young people but
only offered these products for sale? Then, students will make a list of items
they would buy that their parents would not. Point out that stores must offer
products their customers are willing to buy if they intend to succeed. This
is the question “what” is answered in a market economy.
b) Students are asked to think about running a restaurant. How are they going
to be both profitable and efficient? What will yield the greatest profits? How
will they keep the costs of production low? The producers/suppliers must decide
how to make it successful.
c) Students will discuss why many sports stars receive very high salaries .
What do they do that justifies earnings in excess of a million dollars a year?
Usually, people who make more valuable contributions to production are paid
better and receive more of what is produced (the benefits-$$). How do their
earnings help answer the question for whom. Remember it is the people who pay
for tickets or buy the products advertised on television that are really paying
the salaries. Many people who earn little money cannot afford to go to a game.
Do the students feel it would be a good idea for the government to limit what
a sports star earns to two or three hundred thousand dollars a year and then
force ticket prices to be lowered? In what way would such a law change the way
the question “for whom” is answered.
d) Students will review the 3 basic questions by filling out a chart on a worksheet.
One part of the chart will list the general answers to each of the questions.
On another part of the chart, students will decide their own answers to the
questions after picking an example of a good or service to produce.
Evaluation:
1) Class participation/work
2) Homework: Students will…
-Read Section B, pg.40-43 and answer “Self Check” & “Applying
what you Have Learned” questions on pg. 43.
-Read and do the questions for “Developing Your Economic Skills-Interpreting
a Table” on pg. 55.