Standards for The Great Tulip Boom: Economics in World History

Standard: 5

Name: Business Decisions and Market Structure

Businesses typically make decisions to maximize profit. Competition among sellers usually lowers costs and prices for buyers. A lack of competition in some types of markets can lead to higher prices and less-favorable outcomes for buyers.

• K-5: In elementary school, students learn that businesses use resources to produce goods and services, and that buyers and sellers interact in the market. Entrepreneurship is also introduced.
• 6-8: In middle school, students learn about the idea of profit and how businesses and consumers interact. Students learn more about how businesses are legally organized and their goals. Students learn how the behavior of buyers and sellers affects market outcomes. Students then explore the costs and benefits of being an entrepreneur.
• 9-12: High school students, while they do not learn about specific market structures, investigate why competition may vary across different markets. They also learn how businesses decide how much to produce and why competition prevents businesses from influencing the market price. Students learn why some markets have less competition, with concepts such as network effects being introduced.Benchmark Students will know that: Students will use this knowledge to: 5.E.1 Producers use natural resources, human resources, and capital resources to make to make goods and services.Identify a good they can make and sell (e.g., friendship bracelets) and determine what resources they need to produce 20 units, including how many hours of labor. 5.E.2 Competition exists when there are multiple buyers and sellers of similar products.Explain whether the opening of a second vendor selling the same product at a farmers market is good for buyers, sellers, or both.

Name: Investing

Standard: 4

• Students will understand that: People can choose to invest some of their money in financial assets to achieve long-term financial goals, such as buying a house, funding future education, or securing retirement income. Investors receive a return on their investment in the form of income and/or growth in value of their investment over time. People can more easily achieve their financial goals by investing steadily over many years, reinvesting dividends, and capital gains to compound their returns. Investors have many choices of investments that differ in expected rates of return and risk. Riskier investments tend to earn higher long-run rates of return than lower-risk investments. Investors select investments that are consistent with their risk tolerance, and they diversify across a number of different investment choices to reduce investment risk.