Grades 9-12
Drawn from Economics for Everyday Living, the following are the concepts that are seen as important in helping Canadians to understand and analyze economic matters, issues and events that have an impact on their lives. Following the list of concepts is the proposed curriculum outcomes/expectations that relate to each.
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Section A: |
Economic Concepts for Effective Analysis and Decision Making |
| Economic Concept | What's to Know |
| Comparative Advantage: | The ability of a person, company, or country to produce a good or service at a lower cost (that is, more efficiently) relative to other goods and services. |
| Distribution: | The process by which resources, income, wealth, products, and services are divided among people and purposes. |
| Economic Efficiency: | The extent to which resources are used for the purpose for which they are best suited and most desired by society. |
| Economic Freedom: | The extent to which decisions and actions are based on personal choice and preference rather than on such external determinants as laws, regulations, and the dictates of others. |
| Economic Growth: | 1. An increase in the production of goods and services. Economic growth is usually measured as the increase in gross domestic product over a specified period of time, after adjusting for inflation. 2. An increase in the capacity of an economy to produce due to more and/or better use of economic resources. |
| Economic Performance Indicators: | Statistical measures of current economic conditions and changes (for example employment, inflation, productivity, growth). |
| Economic Power: | The ability of a person or group to influence personal, household, workplace, or societal economic conditions and outcomes. |
| Economic Resources: | The natural resources, labour, and capital goods (for example, equipment, tools, buildings) that are used to produce goods and services. |
| Economic Scarcity: | The problem created when relatively unlimited needs and wants exceed the availability of limited resources. |
| Economic Stability: | The economic goal of limiting undesirable changes in prices, employment, and production. |
| Economic Statistics: | The quantifiable economic information that serves as input to economic decisions and actions. |
| Economic Surplus: | Production of goods and services, and the attainment of income, that are beyond basic needs and that can be used in exchange for other things that are needed/wanted. |
| Economic Sustainability: | The extent to which an economy can use its resources to satisfy economic needs at the current rate or better into the future. |
| Employment Independence: | The extent to which a person or household can function without the need for employment income (for example, the ability of a person to "retire," or the necessity for a household to have two income earners). |
| Externalities: | A cost or a benefit of economic activity that affects people other than those directly involved in its use or production. |
| Interest: | Payments for the use of borrowed funds. |
| Investment: | 1. As used in economics, spending on capital goods such as factories, mines, and machinery so as to increase the productive capacity of the economy. 2. In its broader meaning, investment is any purchase of an asset in the hope that, over time, there will be an increase in the value of the asset. |
| Markets: | 1. Where buyers and sellers of commodities (goods, services, or resources) negotiate a mutually agreeable "price" or other "rate of exchange" so a trade may occur. 2. The demand, actual or potential, for a product or service. |
| Money: | A commodity, now most commonly issued by a government as official currency, that can be used to pay for goods and services, to measure the price of things, and to serve as a store of value. |
| Opportunity Cost: | The loss of the benefits that would have been received from the next best alternative whenever a choice is made. |
| Productivity: | Output of goods or services per unit of input (for example, widgets per worker). |
| Risk: | The degree of uncertainty associated with the potential outcome/result of an economic decision or action. |
| Saving: | The decision to accumulate personal or economic resources for later rather than current use. |
| Work: | The physical and intellectual efforts of all those who make a productive contribution to households, business activity, communities, and society as a whole. |
Outcomes/Expectations Related to the Key Concepts
Students should be able to:
- Demonstrate how the interaction between the supply of, and the demand for, a good or service, will affect the market price.
- Demonstrate how, as the supply of a good or service tends to rise in a market, the market price for that good or service will tend to fall, depending on what happens to peoples' willingness to buy the good or service (i.e., the demand).
- Describe the basic economic problem that confronts every society (i.e., economic scarcity).
- Demonstrate how the level of competition among sellers of a good or service can affect things such as the price, the quality, the reliability, the level of service, etc. that is available to consumers.
- Illustrate how, and explain why, the quantity supplied of a good or service will tend to increase as the market price of that good or service increases and that the quantity demanded will tend to fall.
- Explain why inflation tends to become more of a problem as the level of output in an economy moves closer to the capacity of the economy to produce.
- Explain why it is that when something is relatively scarce it assumes economic value and the value will be reflected in how the supply of the resource compares with the demand there is for its use.
- Explain why economic scarcity leads to people making choices and trade-offs because they can't have everything they want.
- Define the unemployment rate as the percentage of the labour force that is willing and able to, does not currently have a job, and is actively looking for work.
- Compare the concept of economic scarcity with the concept of something being rare recognizing that something does not have to be rare for it to be relatively scarce (e.g., oil, forests).
- Explain how a price system is commonly used to distribute what is produced — that is, those who want something, and can afford it, can acquire it.
- Explain why it is that the rate of inflation and interest rates tend to move in the same direction.
- Identify some of the key factors that will influence the economic capacity of an economy — that is, its capability of producing goods and services.
- Describe why, as an economy moves closer to its capacity, available resources become more scarce, the cost of those resources tends to rise, and prices are pushed higher.
- Investigate a number of resources that have little or no economic value, and therefore little or no economic cost, because people largely do not regard the resource as relatively scarce — e.g. air, water (in some areas), etc.
- Describe the key roles that are played by money in the economy.
- Identify the opportunity cost (i.e. the best alternative given up) involved in a number of recent personal economic decisions.
- Research to determine some of the goods and services that are not distributed through a price system and explain why — e.g. roads, sidewalks, sewers, schools, etc. (that are required for use by everyone).
- Contrast the concept of economic growth (an increase in the quantity of goods and services produced in an economy) with the concept of economic capacity (the quantity of goods and services that an economy is capable of producing given the available resources).
- Explain why the level of production in the Canadian economy tends to rise and fall over time as it experiences a business cycle.
- Describe the concept of economic stability as one in which the economy is able to grow steadily with conditions of stable prices and relatively low levels of unemployment.
- Demonstrate an understanding of the consumer price index as the statistic that is used to measure the rate of inflation in the economy.
- Describe why, as an economy moves closer to its capacity, producers become less able to respond to spending demands in the economy, inventories tend to decline, and additional spending will therefore tend to pull prices higher.
- Compare the features and general characteristics of a market economy, a command economy, and a mixed economy.
- Explain why money is used in the economy.
- Explain the concept of economic growth as the increase in the production of goods and services in an economy.
- Demonstrate an understanding of how total output in an economy is measured.
- Explain how growth can occur through increasing productivity — that is, generating more output from the same or less input.
- Apply an understanding of the concept of comparative advantage to explain why a country may not export a good or service that it can produce more cheaply than other nations
- Explain how the value of money is derived from the willingness of people to accept it in exchange for goods and services at various prices.
- Compare the level of interest rates in an economy when the rate of inflation is low and when it is high to recognize that interest rates tend to move in the same direction as the rate of inflation.
- Summarize how a price system can lead to some people being able to acquire more in the way of goods and services than others.
- Compare the features and general characteristics of capitalism, socialism, fascism, and communism.
- Specify what it is that is used as money in Canada — and in a number of other nations.