1. What, How and For Whom to Produce? Roosters to Robots Lesson 4

2. Bellringer  Copy the objective: I will be able to explain the characteristics of a command and market economy  In the United States what do we produce, how do we produce it and for whom do we produce it?

3. Objective  I will be able to:  Define an economic system as a way people organize the production, distribution, and consumption of goods and services.  State and explain the three basic economic questions every economic system must answer: What to produce? How to produce? For who to produce?  Describe the basic characteristics of market and command economies

4. Materials  Cop of Activities 1,2, and 3 for each group  2 sheets of white paper, 1 sheet of colored paper, pencil, magazine with colorful pictures, glue, 2 napkins, 2 paper plates, 5 safety pins, scissors, 10 straight pins, and blue, black, and red marker for each group  Transparency of Visual 1

5. Activity  Today you have been placed in groups and will produce “good economist badges” that will be distributed to students who meet a certain criteria.  Please choose a name for your country and choose one spokesperson

6. Round 1  Please look at Activity 1 now. Notice the resources that are necessary for producing good economist badges  2 paper plates, 1 sheet of white paper, 1 sheet of colored paper, 10 pins, a magazine with colorful pictures, and a black marker.  Read the instructions on the Activity 1 sheet.  You will have 5 minutes to complete the activity

7. End of Round 1  Each spokesperson will display the group’s products  Please turn in your badges to Mrs. Wheeler now  Raise your hand if you think you are a good economist and should receive a badge  I have already decided how the badges will be distributed. I am going to keep half of them because I am the best economist in the classroom, I will distribute the rest

8. Discussion Round 1  Are you satisfied with the results of this activity? If not, why?  Were you able to design the badges? Why?  Who decided what resources would be used to produce badges?  What problems occurred in the production process?  What economic incentives influenced the production teams?  Did the lack of economic incentives affect the quality of the final product?  What decisions were the members of each group able to make about production and distribution of badges?

9. Defining Economic Systems  Economic System: the way people decide to organize production, distribution, and consumption. The decisions people must make about production consumption, and distribution are: What to produce? How to produce? For who to produce?  There are different economic systems that answer these questions in different ways.

10. Round 1Round 2 Type of Economic System What to produce? How to produce? For whom to produce?

11. Command Economy  A central authority makes the decisions about what, how, and for whom to produce  In round 1 the teacher was a central authority making decisions about what, how, and fro whom to produce, so the class had a command economy.

12. Round 2  In this round members of the groups will be able to make decisions about the production and distribution of badges  What types of decisions must need to be made?  What to produce- what the badges look like  How to produce- what resources to use  How many to produce and for whom- who will receive the badges after they have been produced

13. Round 2  Please look at Activity 2 now.  Discuss with your group. What do you want the badges to look like?  Consider your available resources and decide which six you will use to produce the badges  You will have 10 minutes to complete the activity

14. Round 1Round 2 Type of Economic System What to produce? How to produce? For whom to produce?

15. Round 2 Discussion  Why are the products produced in round 2 different from those produced in round 1?  Who decided which resources each group used to produce badges?  Why were more produced?  Who will receive the badges produced by your group?  What economic incentives influenced the production teams?  How did the presence of incentives influence production quality of the final product?

16. Market Economy  Producers and consumers make decisions about what, how, and for whom to produce goods and services  In round 2 the class had a market economy.

17. Closure  Look at the chart you have created:  What is an economic system?  What are the principal questions that every economic system must answer?  Who makes decisions concerning the types of goods and services produced, the way in which goods and services are produce, and who receives the goods and service produced in a command economy?  Who makes decisions concerning the types of goods and services produced, the way in which goods and services are produce, and who receives the goods and service produced in a market economy?