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List of Benchmarks for Economics

Standard 9.Understands how Gross Domestic Product and inflation and deflation provide indications of the state of the economy
  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. Not appropriate for this level
  Level III (Grade 6-8)
   1. Knows that inflation refers to a sustained increase in the average price level of the entire economy
   2. Knows that deflation refers to a sustained decrease in the average price level of the entire economy
   3. Understands that inflation reduces the value of money and that people’s purchasing power declines if their incomes increase more slowly than the inflation rate  A 
   4. Knows that Gross Domestic Product (GDP) is the total market value, expressed in dollars, of all final goods and services produced in the economy in a given year and is used as an indicator of the state of the economy
  Level IV (Grade 9-12)
   1. Knows that inflation is usually measured by the Consumer Price Index (CPI) which shows the increases or decreases in price level from one year to another
   2. Knows the difference between "nominal" GDP (i.e., GDP stated in current dollars where an increase in GDP may reflect not only increases in the production of goods and services, but also increases in general prices) and "real" GDP (i.e., GDP which has been adjusted for price level changes)  A 
   3. Knows the factors upon which a country’s GDP depends (e.g., quantity and quality of natural resources, size and skills of labor force, size and quality of capital stock)
   4. Understands the economic growth is a sustained rise in GDP, which results from investments in human and physical capital, research and development, technological change, and improved institutional arrangements and incentives
   5. Understands that economic growth can alleviate poverty, raise standards of living, create new employment and profit opportunities in some industries, but can also reduce opportunities in other industries  A 
   6. Understands that inflation creates uncertainty because it affects different groups differently (e.g., inflation hurts people on fixed incomes, but helps people who have borrowed money at a fixed rate of interest) and because it causes people to devote resources to protect themselves from inflation   A 
   7. Knows that inflation occurs (and/or employment increases) when money supply or desired expenditures for consumption, investment, government spending, and net exports are greater than the value of a nation’s output of final goods and services, and vice versa (i.e., inflation decreases when these expenditures are less than the value of output)  A 
   8. Understands that government policies designed to reduce unemployment (e.g., increasing federal spending, reducing taxes) may increase inflation, and vice versa

 A  = Assessment items available