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The Stock Market: Risks & Rewards

Lesson Plan: Scarcity, Choice, and Decisions

Activity 1: Planning the Prom

Name _____________________________________

Your class has been engaged in various fund-raising projects during the past several years, and you now have a total of $9,635 to spend on a big bash - your last school dance. You may not spend more than this amount on the dance, but you do not have to spend all of it on the dance. Any money "left over" can be used for a class project, designed to help your school or community.

You have decided that there are three categories of expenditures for the dance. 1) hiring a band, 2) renting a place to hold the dance, and 3) providing refreshments and decorations. A committee has provided the following information:

Bands Available:
Cost	Name
$1,000	Plain, Loud, and Cheap, a local rock and roll band
$2,500	Busting Gourds, rock with an English twist
$4,000	Granite - good hard rock
$5,000	The National Debt - "getting bigger every day" - a popular new group
$6,500	Philadelphia Transit Authority (the PTA) - nationally known, 2 gold albums
$8,000	The Rolling Rocks - well known touring group from England

Places Available:
Cost	Name
$200	School Gym
$600	American Legion Hall
$1,500	The Inn on the Hill
$2,000	The Two Seasons Hotel
$3,000	The Valley Country Club

Refreshments and Decorations:
Cost	Name
$500	Home Economics classes fix sandwiches and make decorations
$1,000	Catered - snacks and decorations
$3,000	Catered - fancy snacks and fancy decorations
$5,000	Package deal - snacks and decorations at dance; and an after-dance meal at a restaurant.

Your task now is to decide, with the other members of your class, which band to hire, where to hold the dance, and what type of refreshments and decorations to provide. Your class must select one item from each expenditure category.

Discussion Question

In what ways is this problem similar to economizing problems faced by your family? In what ways is it different?

Keep a money diary that tracks what you save and spend. It will tell you about when, why, and how you use money.