## Invest in Your Education

• Lesson
6-8,9-12
1

In this lesson, students purchase the common items used in their mathematics classroom such as desks, chairs, calculators, manipulatives, etc. They are given a budget that they must work within plus coupons that they must use when making their purchases. The lesson lets students have fun while applying the concepts of discount and percent. Since students use a purchase register to track their purchases, it also serves as a review of integer operations.

Preparing for the Lesson

Some of your students have probably had little, if any, exposure to the use of coupons or discounts when making retail purchases while others could be considered experienced consumers. They are too young to have their own checking accounts or debit cards, but some may have an account with an adult. In this lesson, students assume an account pre-loaded with money and use coupons and other discounts to make wise purchases.

A good number of today’s youth has experience with debit cards, gift cards, and maybe even credit cards. Following the current trend, assume that all transactions during this lesson are made electronically. If your state financial literacy goals require that students be able to write checks, you can provide students with checks to make their purchases. You can also allow students to write checks as an extension to this lesson, but be prepared that the activity will require more class time; in fact, it may be necessary to spend as much as an entire class period teaching students how to write checks.

Prepare an inventory list of items that students can purchase. The list should include pencils, desks, chairs, calculators, student whiteboards, paper, and any other items you deem appropriate for this activity and your student population. Given the limited time to complete this activity, consider limiting the number of items for sale to fewer than 10. The following is a suggested list of items and prices:

• Adjustable student desk $79 • Student chairs$34
• Student calculator $10 • Pencil and paper$1
• Student whiteboard $5 • Whiteboard marker$1

If you do not know the prices of certain items, check with the person in your school responsible for purchasing supplies beforehand. Spend some time doing this research to make the activity as authentic as possible. The total retail value of the items listed above is $130 before applying coupons and sales tax. If you decide to use the suggested prices above, give students a starting balance of$130. That way, they will not get into an overdraft situation. This lesson is based on a sales tax of 5%, but you may want to change it to your local tax rate.

In order to make this lesson meaningful and one that students will remember for years to come, prepare your classroom in advance. Consider moving all desks, chairs, and other items that you want students to purchase to one side of the room. On the board write a sign indicating that there is a "one day only" sale on classroom supplies and that students will need to purchase their desks, chairs, calculators, etc. before they can have access to them. Post the inventory/price list or provide it to students as a handout. This activity works best if students come to class empty-handed, so it is a good idea to tell them the day before this lesson that they are to bring nothing to class. Be prepared for a little shock and a few "no ways."

The Lesson

As students enter the classroom, ask them to store all personal belonging in a corner of the room. Then hand them a purchase register listing the items available and the Invest in Your Education activity sheet.

 Invest in Your Education Activity Sheet

Invite students to sit on the floor. Once they are seated, explain that they have to invest in their educations and today they are going to purchase their classroom supplies. There are 3 coupons included with the Invest in Your Education activity sheet that they must use as part of this activity. The must choose which coupon to apply to which item, but coupons may not be combined. Students may only purchase one of each item, as quantities are limited. Students can choose to purchase their items in any order. (It's surprising how many students choose to purchase a desk or chair before the calculator, but in the end it's their decision.)

Students need to calculate the discounted price plus sales tax accurately before they can take possession of their purchase. To facilitate checking student calculations, consider involving a teacher’s aide, one or more parents, or even a guest from a local retail business. If some students who complete the activity quickly, they could help struggling students or help to verify of student calculations. Once all students have completed their purchases, bring the class together for a group discussion of key questions. Some suggested questions can be found in the Questions for Students section below.

If time or classroom help is in short supply, you may want to complete this lesson over two class periods. In the first class, have students make their purchases and document their calculations. Then collect students' purchase logs and check their accuracy before the second class period. Alternatively, distribute the logs at the beginning of the second class so they can be peer checked. Then have a group discussion of key questions.

• Everyday classroom items and supplies, such as desks, chairs, pens, and anything else students typically need for class
• Calculators
• Student white boards with markers (optional)
• Paper and pencil (optional)
• Price list
• Invest in Your Education Activity Sheet

Assessments

1. Check the accuracy of student calculations and purchase registers.
2. Gauge student understanding in a class discussion.
3. Consider using similar retail shopping scenarios as questions in a summative assessment.
4. Ask students to bring in retail ads showing in-store discounts, loss leaders, or coupons. Use these ads to have students calculate the retail prices after the discounts are applied. Ask students to identify any sale items that they think the retailer might be using as a loss leader or bait to get consumers to come to their store.

Extensions

1. Have students bring in receipts from family purchases that reflect the use of coupons and/or discounts. Use these receipts to illustrate that tax is calculated after the discount is applied.
2. Have students pay for their individual purchases with checks. Some states have a financial literacy requirement that calls for students to be able to write checks in the proper form. If you state requires lessons in financial literacy, consider using this activity as part of your program

Questions for Students

1. When you make a purchase with a coupon or when you take advantage of a discount, why is the discount taken before sales tax is calculated?

[Sales tax is a value tax based on the net cost of the goods to the consumer. The net cost (or net value) is the amount of money the merchant is willing to accept in exchange for the goods. Since sales tax is collected by a government agency and is not revenue for the merchant, the store applies its discount before the taxes are calculated.]

2. What is meant by "30% off"? What percentage of the purchase price does the consumer pay?

[30% off is a discount offered by the merchant to entice consumers to buy. The consumer pays 70% of the regular price. Some students may assume that they will pay the 30%. A good way to address this common error is to ask students to check for reasonableness. For examples, assume that a popular video game that retails for $25 is being offered at 20% off. Is it realistic to assume the merchant will allow the consumer to walk out of the store paying only$5.00? This type of illustration usually puts things in perspective for students.]

3. You are interested in buying a new gaming system but the $300 price is just too high. What amount of discount, if any, would make you reconsider buying the system? Why did you choose this particular amount? [Answers will vary depending on student demographics. Encourage students to calculate the purchase price based on various discounts to help them make a more informed decision.] 4. We often see coupons in the newspaper that vary in value from$0.25 to several dollars. How much would a coupon have to be worth before you would take the time to cut it out and redeem it? How does the cost of the product influence your decision?

[Answers will vary depending on student demographics; some of your students' families may clip and use as many coupons as possible. If you have a diverse group of students, encourage them to share their experiences with coupons and savings.]

5. Do coupons influence what you buy. Why or why not?

[Answers will vary depending on student demographics. Overall, coupons have been proven to influence our buying decisions, which is why manufacturers and retailers continue to use them.]

6. Let's say a store is offering merchandise at 50% off. You bring in a coupon from the newspaper for an additional 25% off the reduced price. Will the store give you 75% off the price?

[Many students will be under the false impression that they will receive a 75% discount because they intuitively believe discounts are additive. Since percentages are calculated using multiplication and division, they are multiplicative, not additive. For example: A product sells for $100 and is offered at 50% off, which means the net cost is 50% of$100, i.e. $50. With the coupon you get 25% off the last marked price. 25% of$50 is $12.50, so the final cost is$37.50. A 75% discount of the original $100 would have resulted in a sales price of$25.]

Teacher Reflection

• What was your students’ initial reaction to this activity? If positive, what aspect did they enjoy the most? If negative, what could you change to make it a more positive experience?
• Do you consider your students consumers and if so, did they have enough real-life experience to understand the power that retailers have over consumers when they use discounts and coupons?
• Did you challenge the achievers? How?
• Did the lesson enhance students fluency with percentages?
• What were some of the ways in which students illustrated that they were actively engaged in the learning process?
• How did students perform in relation to the stated behavioral objectives?
• What content areas did you integrate within the lesson? Was this integration appropriate and successful?

### Learning Objectives

Students will:
• Solve practical problems involving percents
• Solve consumer-application problems involving discounts and sales tax
• Accurately record all purchases to determine the balance remaining in a checking account with a set opening balance

### Common Core State Standards – Mathematics

Grade 7, Ratio & Proportion

• CCSS.Math.Content.7.RP.A.3
Use proportional relationships to solve multistep ratio and percent problems. Examples: simple interest, tax, markups and markdowns, gratuities and commissions, fees, percent increase and decrease, percent error.