Grades: 3 to 6
Class Time: 1 hr.
Focus: Set up a buying center in the classroom where students have an opportunity to buy and sell items. Students can either make specific items to sell, bring “white elephant” items from home to sell, or cut out pictures from magazines to represent items to sell. Give students a set amount of money to spend. Allow students to shop for ten or fifteen minutes. Talk about what sells and what does not. Why do some items sell better than others? Relate to “opportunity cost” concept. Students should be able to give an example and use the term “opportunity cost.” For example, suppose you have one dollar. There are five different items that cost one dollar each. Rank the five items from your first choice to the fifth choice. The opportunity cost of purchasing your first choice is the value to you of the second choice.
Outcome: Students will see how opportunity costs relate to real life economic decision making.
Objective: After working through the center, children will have practice counting money, and will be able to describe how opportunity cost relates to real life in every economic decision.
Core Competencies: Sharing earth-space with others: the community.
1. Set up a buying center in the classroom. Have students either bring “white elephant” items from home or cut out items that they might like to buy from magazines, catalogues, etc. Allow students to make the decisions on what should be cut out, and how items to be sold should be organized. Extension: Students can make items to be sold in buying center, or can earn money outside of school to spend on buying items.
2. Have play money available for the purchasing of items or allow students to use real money they have earned outside of class to buy for sale.
3. List prices on each item. Review the concepts of supply and demand and production costs.
4. Keep records of what sells and what does not. Analyze why some things sell and others do not.
5. Students can be assigned as store owners. After deducting the costs of items, overhead, and payrolls, how much must be added to the cost of items to make a profit? Keep accounting records.
6. Have students that are purchasing items keep a budget on how much they have, what they purchased, why they purchased the item, what they would like to purchase but didn’t have enough money to purchase, and if they had any money left? How did their purchasing habits relate to opportunity costs?
Materials/Resources: Old catalogues, magazines, etc.; file folders in which to keep these items; student made products; construction paper on which to list the prices of items; play money or real money that students have earned themselves; boxes in which to keep the money; paper and pencils to be used for keeping assets and expenditures.
Evaluation: Check the students’ budgets. Check store owners’ records to see if they made a profit.
Extensions: Items could be made by students and sold in buying center. See if students can make a profit. Keep cost of items made, overhead, etc.
Vocabulary: Opportunity cost, budgets, accounting record, profit, shortage, scarcity.
Related Skills: Students should have previous skills with counting money. Review economic concepts such as needs, wants, consumer, producer, goods, services, scarcity, shortage, etc.
Reference: Lenning, Lorene R. (1990). More Than Money – An Activities Approach to Economics. Glenview, IL: Scott Foresman, and Company.
Source: Edwards, Cindy and Murphy, Carole (1995). Elem. Educ. 253, Social Studies Methods, Univ. of Mo., St. Louis.