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The Market Economy

The Market Economy content area includes

  • the relevance of limited resources,
  • how individuals and institutions make and evaluate decisions,
  • the role of incentives,
  • how buyers and sellers interact to create markets,
  • how markets allocate resources, and
  • the economic role of government in a market economy.

Economically literate grade 12 students are able to identify what tradeoffs they face—what they gain and what they give up when they consider alternatives and make choices. Doing so informs their decisions, helping them choose alternatives that promote their goals as consumers, producers, savers, investors, and citizens. They can identify incentives that affect people's behavior and explain how incentives affect their own behavior. In addition, these students can

  • describe how the interaction of buyers and sellers in markets influences prices and output levels;
  • describe the likely effects of plans for education, training, and career options on future earnings and can identify the risks, returns, and other characteristics of entrepreneurship that bear on its attractiveness as a career; and
  • describe the roles of economic institutions, such as legal systems, private property, labor unions, and corporations.

Content in the Market Economy includes much of what is traditionally described as microeconomics.

Last updated 03 November 2006 (JM)