La Habra High School
Social Sciences Department

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Social Science Standards - Economics

MICROECONOMICS PRINCIPLES

• understand the laws of supply and demand.
• define utility, the law of diminishing marginal utility, income effect, and substitution effect.
• define elasticity of supply and demand.
• determine factors that influence price changes.
• distinguish factors influencing demand vs. supply.
• define equilibrium, shortage, and surplus.
• recognize Adam Smith's contribution.
• examine how a market economy works.
• define different forms of business ownership.
• define entrepreneurship.
• analyze gross and net profit, overhead cost, market share, market penetration, competition.
• follow the profit and/or loss of a corporation.
• define marginal revenue and marginal cost.
• define marginal revenue product and marginal resource cost.
• define fixed and variable costs.
• understand the concept of profit motive.
• analyze how profit/loss directs activity.
• define scarcity and resources.
• understand the allocation of resources.
• define production possibility curve and opportunity costs.
• examine government intervention.
• distinguish between price floors and ceilings.
• identify examples of subsidies & price controls.
• evaluate the role of competition.
• evaluate the effects of competition.
• compare corporations in modern markets.
• examine the role of modern advertising.
• identify pure and monopolistic competition, oligopoly, monopoly, and monopsony.
• identify problems associated with each of these market conditions.
• identify the different financial markets.
• know how to read stocks tables.
• distinguish between common and preferred stock.
• differentiate between stocks, bonds, mutual funds, certificates of deposit, commodities, and annuities.
• identify California's economic activity in agriculture, technology, entertainment, aerospace, and tourism.
• examine the role of labor unions.
• explore union & management relations.
• review the formation of unions.
• distinguish between closed/open shop.
• evaluate collective bargaining.
• examine the pros and cons of unions.
• recognize the implications of the minimum wage law.
• trace the rate of unemployment.
• define labor force.
• examine demographics of labor force.
• acknowledge changes in labor force.
• define the types of unemployment.
• analyze the distribution of income.
• analyze supply and demand in the labor force and the effect on wages.

MACROECONOMICS PRINCIPLES

• define gross national and gross domestic product (GDP).
• determine what is included and excluded in gross domestic product.
• define prosperity and recession.
• define inflation and deflation.
• identify causes and effects of inflation.
• construct the business cycle.
• define nominal vs. real in income, gross national product, and inflation.
• construct the CPI and calculate the GDP.
• create a consumption function.
• define and calculate APC, APS, MPC, & MPS.
• define and calculate the spending multiplier.
• define and construct aggregate demand and aggregate supply graphs.
• identify the relationship between unemployment and inflation (Phillips Curve).
• define short-term and long-term interest rates.
• analyze government role in a market economy.
• explore the roles of Congress and the President in constructing the Federal budget.
• examine spending in the Federal budget.
• explore the effects of special interest groups.
• identify how the government taxes the citizens.
• identify different tax principles.
• distinguish between budget deficit and national debt.
• examine the long-term consequences of a large national debt.
• examine historical roots & tools of fiscal policy.
• define expansionary/contractionary fiscal policy.
• determine the current state of the economy.
• identify problems of the crowding-out effect.
• define money, its functions, and its types.
• define actual, required, and excess reserves.
• define and graph money demand, money supply, and investment demand curves.
• identify elements of money demand.
• define and calculate the money multiplier.
• describe the federal reserve system.
• compare and contrast Keynesian economics, monetarism, supply side economics, and rational expectation theories.

ISSUES OF INTERNATIONAL TRADE

• define absolute & comparative advantage.
• explore modern world geography & data.
• identify major U.S. trading partners.
• define imports, exports, and balance of trade.
• define protectionism and free trade.
• define tariffs, quotas, voluntary trade, and restrictions.
• examine free trade vs. protectionism.
• distinguish between the Great Depression and modern society.
• study the development of trade blocs.
• identify the role of the World Bank and effects of the end of the Cold War.
• examine problems in transitioning to a market economy from a command economy.
• identify factors determining exchange rates.
• examine the economic impact of an appreciating and/or depreciating dollar.
• calculate current account & capital account.
• analyze the impact of a balance of payments deficit or surplus on a nation's economy.