Lesson Plan: Our Economic System


Objectives: The students will

I. describe how the American economic system works.

II. outline how American business is organized.

III. discuss the ways business decisions are made.
Warm Up Activity (Anticipatory Set): Defining Economics

A) Ask students to list all the ideas they can on one piece of paper that deal with the question:

"What is economics?" or "List all the things that have to do with the economy."

B) Generate a class list using the overhead projector. Have students take notes.

C) Then classify the elements the students listed under the major headings:

Business Taxes Trade Employment Resources


(Some elements may be classified under more than one heading).

Main Activity (Instructional Input):

A) Use Chapter 16 of the textbook (American Civics) to define the following terms. Divide the class into groups and have students define a set of questions. Then have the group members teach the class the definitions by

The Terms

Section One Pg. 308-315

  1. Standard of Living
  2. Economy
  3. Free market
  4. Free competition
  5. Profit and profit motive
  6. Invest
  7. Copyright
  8. Patent
  9. Scarcity
  10. Law of supply
  11. Law of demand
  12. Capitalism
  13. Capital
  14. Capitalist
  15. Stock
  16. Free enterprise system
  17. Monopoly
  18. Merger
  19. Trust
  20. Conglomerate
  21. Public utilities
  22. Command Economy
  23. Mixed economy

Section Two Pg. 315-319

  1. Single proprietorships
  2. Partnership
  3. Corporation
  4. Stockholders
  5. Dividends
  6. Charter
  7. Board of Directors
  8. Executives
  9. Management
  10. Preferred Stock
  11. Common stock
  12. Bonds
  13. Interest

Section Three Pg. 319-327

  1. Factors of Production
  2. Land
  3. Rent
  4. Labor
  5. wages
  6. Salaries
  7. Productivity
  8. Entrepreneurs
  9. Managers
  10. Gross income
  11. Net income

Examples (Modeling): Using the Internet

A) Have students look through a magazine and choose a business to visit. Or, the teacher can hand the students a URL of companies chosen beforehand. Some companies can be well-known, others not-so-well-known.

B) Allow students to use the Internet and visit the website of that business.

C) Have students answer and present the following information:

1) Company Name
2) Product or products being sold
3) Location of business
4) Was on-line commerce available?
5) History of the company

D) Have the students develop the following Business Plan Guide for the company they visited

1. Name your product or service
2. Give reasons for developing this business
3. What is required to start the business?

A. Natural resources
B. Labor resources
C. Capital resources

4. What type of business management will be used?
5. What will be government's role in your business?
6. How will you produce and distribute?
7. Who will consume it?

Check For Understanding: Questions on the Chapter

1) Identify five freedoms in the American economy.

2) Explain how the laws of supply and demand operate.

3) What are the four factors of production and give an example of each.

4) Identify three types of business organization and briefly describe each.

5) Describe the five most important features of a corporation.

Guided Practice: True/false Correction

Determine if each of the statements is true. Correct any falsehoods in the statement.

1) A business owned by two or more people that is not incorporated is called a proprietorship.

2) The right to own and use private property is guaranteed by the United States Constitution.

3) In a command economy, no one person or group decides how many people will work in a certain job.

4) In a mixed economy, the government sometimes acts as referee.

5) Partnerships receive charters to operate from states.

6) When economists use the word land, they also mean the natural resources that come from the land.

7) The managers of a corporation decide when to issue dividends to stockholders.

Wrap Up and Homework (Independent Practice): The Economy In The News

A) Have students locate a newspaper article or Internet news web page with an economic story.

B) Have students summarize and describe the article to the class.

C) Make a list of economic concepts covered by the students. Define and discuss each. 

Evaluation: The lesson will be evaluated by:

I. the accuracy of student's written responses;

II. student's scores on future tests and quizzes.

George Cassutto's Cyberlearning World

     [Lesson Plan of the Day]     [Cassutto Memorial]    [About the Author]    [Search]    [Civics Lesson Plans]