Overview

In this experience, students define the concept of economy. Then they explore some of the characteristics of a free enterprise system: producers and consumers, limited government control, private property, supply and demand, and opportunity cost. Next they examine causes of economic growth and explain an example. Finally, they analyze the scenario of a T-shirt printing business and identify economic concepts within the scenario.

Estimated duration: 60-75 minutes. You may consider teaching this lesson over two sessions to give students time to absorb the concepts and formulate any questions that they have.

Discovery Reading

A printable Discovery Reading is included in the student pack as a support for understanding the experience’s core content and concepts. This Discovery Reading is not necessary to complete the experience and serves as an optional support resource.

Vocabulary Words:

These vocabulary words are used in the experience or connect closely to the standards and content students examine. Students should understand these terms as they work through the experience.

economy: the way goods and services are produced and consumed in a country or community.
free enterprise system: an economic system in which people and businesses make many choices about what to produce, buy, sell, and invest in, with limited government control.
producer and consumer: a producer makes goods or provides services, while a consumer buys goods or services.
supply and demand: supply is how much of a good or service producers are willing to provide, and demand is how much consumers want and are willing to buy; together they help affect prices.
opportunity cost: the next best choice you give up when you decide to spend your time or money on something else.
private property: things such as land, buildings, or businesses that are owned by individuals or companies, not by the government.
productivity: the value or amount of goods or services produced by each worker; higher productivity can help the economy grow.

Objectives

Explain the free enterprise system in the United States
Analyze an example of the free enterprise system

Engage

Suppose your friend has a new game that you really want. To get the game, you might:

trade one of your games for your friend’s game
buy the game from your friend
borrow money from someone you know to buy your own copy
do a job to earn money to buy the game

Which of these choices would be an economic activity? The answer is all of them! Economic activities include choices people make about buying, selling, trading, earning, borrowing, and using resources.

In this lesson, you will learn about the U.S. economy and how people, businesses, and government take part in it.

Objectives

Explain the free enterprise system in the United States
Analyze an example of the free enterprise system

a shopping cart full of boxes on top of the American flag

Based on the examples above, what do you think an economy includes? Use one example from the list to explain your thinking.

Post your answer

An economy is the way goods and services are produced and consumed. Everyone is involved in the economy both by producing goods or services and by consuming them.

When everyone is ready to continue, unlock the next scene.

The U.S. Economy