Teach it. Check it. Revisit it.

Teacher guide

Audience: 12–18. Session: 30 minutes. Preparation: 5 minutes: paper and a calculator.

Prerequisites: Calculate percentage changes and work with a simple budget.

1. Spend 5 minutes asking learners to predict the result and explain their reasoning.
2. Use most of the session for the student activity. Ask learners to show calculations and name assumptions.
3. Reserve 5 minutes for the exit questions. Discuss why the answer follows, not just whether it matches.
4. Return to the follow-up next week without showing today’s answers first.

Student activity

A fictional monthly basket costs $100, then $110, then $115.50. Compare the inflation rate in each year. An income rises from $100 to $108 in the first year: can it buy more of the same basket?

Write your prediction, calculation, explanation and one assumption you would check in a real situation.

Exit quiz

1. Did prices fall when inflation slowed from 10% to 5%?
2. What happened to purchasing power when income rose 8% and prices rose 10%?

Teacher answers and reasoning

1. No. The basket rose from $110 to $115.50. A lower positive inflation rate means prices rise more slowly.
2. Purchasing power fell: 1.08 / 1.10 − 1 is about −1.8%. Income bought a smaller share of the unchanged basket.

For each response, check the method, the result and the explanation. A correct number with an incorrect explanation needs another example.

Next-week review

Next week, use income growth of 6% and price growth of 4%. Explain why the real change is about 1.9%, rather than exactly 2%.

Facts, assumptions and policy debate

Computing a price change is distinct from deciding how government should respond. Compare a policy’s intended benefits, costs and affected groups.

Ask: what is calculated, what is assumed, and what is a judgment about priorities?