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Economics

Standard 2.Understands characteristics of different economic systems, economic institutions, and economic incentives
  Level Pre-K (Grade Pre-K)
   1. Not appropriate for this level
  Level I (Grade K-2)
   1. Not appropriate for this level
  Level II (Grade 3-5)
   1. Knows that people's choices and behavior are influenced by positive incentives (i.e., rewards that make people better off) and negative incentives (i.e., penalties that make people worse off)  A 
   2. Knows that because people's views of rewards and penalties are different, the influence of an incentive can vary with the individual
   3. Understands that the hope of earning profit (i.e., the difference between revenues and the costs of producing or selling a good or service) is the incentive that persuades entrepreneurs and business firms to take the risks of producing goods and services to sell
   4. Knows that households (i.e., individuals or family units), as consumers, buy goods and services from business firms
   5. Knows that households, as resource owners, sell productive resources (e.g., labor, natural resources, capital resources, entrepreneurial resources) to firms in order to earn income
   6. Understands that all societies have developed various economic systems in order to allocate their resources to produce and distribute goods and services and there are advantages and disadvantages to each type of system  A 
  Level III (Grade 6-8)
   1. Understands that employers are willing to pay wages and salaries to workers because they expect to sell the goods and services those workers produce at prices high enough to cover the wages and salaries and all other costs of production  A 
   2. Knows that in a command economic system a central authority, usually the government, makes the major decisions about production and distribution
   3. Knows that in a market economic system individual households and business firms make the major decisions about production and distribution in a decentralized manner following their own self-interests
   4. Understands that national economies vary in the extent to which they rely on government directives (central planning) and signals from private markets
   5. Understands the types of specialized economic institutions found in market economies (e.g., corporations, partnerships, cooperatives, labor unions, banks, nonprofit organizations)
   6. Understands that economic incentives such as wanting to acquire money or goods and services and wanting to avoid loss are powerful forces affecting the way people behave  A 
   7. Understands that entrepreneurs respond to incentives such as profits, the opportunity to be their own boss, the chance to achieve recognition, the satisfaction of creating new products, and disincentives such as losses and the responsibility, long hours, and stress of running a business  A 
   8. Understands that in a market economy the pursuit of economic self-interest directs people and businesses in most of their economic decisions (e.g., to work, to save, to invest)
   9. Understands that many non-economic factors (e.g., cultural traditions and customs, values, interests, abilities) influence patterns of economic behavior and decision making  A 
  Level IV (Grade 9-12)
   1. Understands that the effectiveness of allocation methods can be evaluated by comparing costs and benefits   A 
   2. Understands that economic institutions (e.g., small and large firms, labor unions, not-for-profit organizations) have different goals, rules, and constraints, and thus respond differently to changing economic conditions and incentives  A 
   3. Understands that incorporation encourages investment by allowing firms to accumulate capital for large-scale investment and reducing risk to individual investors
   4. Knows that property rights, contract enforcement, standards for weights and measures, and liability rules affect incentives for people to produce and exchange goods and services  A 
   5. Understands that in every economic system consumers, producers, workers, savers, and investors respond to incentives in order to allocate their scarce resources to obtain the highest possible return, subject to the institutional constraints of their society  A 
    

 A  = Assessment items available