Monday, December 9, 2013

5th Grade Econ 101 - PNC Christmas Price Index

My grandma used to tell me when she was a kid, she could buy a loaf of bread for only 10 cents. Does that sound right to you? Today, we will explore some basic economic principals:
  • What are goods and services?
  • Do the price of goods and services stay the same over time?
  • What is inflation?
Step 1: Ever hear the song The Twelve Days of Christmas? Well, PNC Bank creates a Christmas Price Index each year where they shop for each gift in the song 12 Days of Christmas, and adds up the cost of these items and compares that cost to years past. Can you find the cost for all 12 items on your list?

Step 2: Compare the price of gifts from 2012 to 2011. Each gift is exactly the same as last year, how do you explain any differences in prices? Then watch the video on inflation.

Step 3: Take a look at the graph that shows the average income in the United States from 1914-2004. Compare that graph with the chart containing prices of the Christmas gifts from 1984-2010. Use the graph and the chart to answer the questions on the back of your handout.

Step 4: Use the inflation calculator below to quiz your table partner. Don't forget to write down the information on your handout.

Another video that helps explain inflation:


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