Beacon Lesson Plan Library

Selling, Spending, or Saving

Thomas Lucey


Students use commercials to discover emotional benefits and challenges associated with communications about finances.


The student uses words and images that best express intended messages.


1. Easel pad and pen for writing down class observations.
2. Pen and paper for assessment compositions
3. Download criss-cross puzzle of vocabulary terms and the vocabulary handout from the Associated File and make copies for each student.

4. Download the criss-cross puzzle of vocabulary terms key from the associated file and make one teacher copy.


1. Ensure seating is conducive to rearranging class into groups.
2. Ensure space in the room for performance of skits.
3. Download file the associated file and make a teacher copy of the answer key for extended problems and the answer key for the criss-cross vocabulary and make copies of criss-cross vocabulary puzzle and the vocabulary handout for all students.
3. Ensure easel pad is centrally viewable to all students.


1. Pass out the vocabulary handout from the associated file

2. State: -In general, when people demand (borrow) a lot of money to accomplish their spending, interest rates for loans increase. When people supply (save) a lot of money, interest rates decline. Americans save a smaller percentage of their earnings than people in other countries.

The ideal setting is when no changes in interest rates occur. Governments take different actions in efforts to control inflation. Many changes in the
inflation rate have been due to government involvement. BY CONTROLLING ONEíS
SPENDING, ONE CAN CONTROL THE INTEREST PAID OR EARNED. When you earn interest, increasing interest rates raise your income. However, merchants and credit card companies use emotion to motivate one to purchase when it may not be in their best financial interest. Making purchases by using credit cards because you don't have the cash will earn profits for the banks, and cause interest losses to your money.

In todayís activity, we will look at how commercials use emotion to communicate messages and influence audiences.-

3. Divide the students into four evenly sized groups.

4. Inform two of the groups they will develop commercials promoting savings practices. Inform
the other two groups they will develop commercials promoting spending habits. Each commercial should incorporate emotional appeals. Each commercial may be a maximum of seven minutes long. The groups will have 10 minutes to work on their commercials.

5. After the 10 minutes have passed, instruct the first group to perform the commercial. The
groups should go in alternating order (Save, Spend, Save, Spend or Spend, Save, Spend,

6. At the conclusion of the commercials, bring the whole class together. Discuss the ease or difficulties of developing their commercial. What emotions were promoted by the advertisements? What emotions did the students feel good or bad about? How do these emotions relate to spending and saving? Why do students get the expressed emotions?

NOTE: This lesson also applies to the following Tennessee standards:

English/Language Arts
Curriculum Standards
Approved by the Tennessee State Board of Education
August 31, 2001

8.1.01 Continue to develop oral language and listening skills.
a. Continue to model active listening in both formal and informal settings.
b. Continue to adhere to rules for public conversations


1. Instruct the students to write a composition explaining why more commercials encourage spending rather than savings.

Assessment Checklist:

_____ Composition expresses understanding of commericials' communication efforts.
____ Compositions relate some understanding of a need to act prompted by a good or bad emotion.
_____ Compositions reflect an understanding that emotions prompted from commercials detract from the rational thought process in consumers.

2. Collect Criss Cross Puzzles and evaluate for student understanding of vocabulary terms.


Extending Activities:

Have the students list five simple items their families commonly buy. After researching the
prices, they should ask their parents how much these items cost when they were younger.
How have the prices changed? Plot the various price changes on a line graph. There
should be a variety of data with many different aged parents). Are there similar rates
between certain periods? Is there an overall picture developing?

Have the students watch some television commercial ads for cars. What finance term do
they promote most? What is the interest rate? If the commercial is on video tape, stop the
tape to read all the fine print. What does it say?

Have the students research inflation rates in other countries. What were the causes? How
are they being addressed?

Why do the students think a lot of people have credit cards that they can not pay-off?

Have the students study U.S. inflation rates. Then have them relate significant historical
events of the same period. Include changes in the U.S. Presidency. Are there relationships
between the changes and historical data? What if you adjust Presidency data to allow two
years for policies to take effect?

- Have the students discuss the effect of inflation if.....

- They have outstanding borrowings

- If they have deposit accounts

- If they have fixed incomes

Have the students study the savings rates for Americans over time. What have they found?
Have them examine any changes in the definitions of savings.

Supporting Problems:

1: You have a $2,000 deposit account at the bank earning 4% interest. Last year the
inflation rate was 2%. What is your real rate of return? What is the rate was 3%? If you
were in the 28% tax bracket, whatís the after tax real return? If in the 15% tax bracket?

2: Last year the band Wealthtunes had a CD which retailed for $10.95. This year, eighteen
months after the first CD was released, the bandís new CD retails for $12.45. At what
annual rate have the bandís music prices increased? What will the following release cost
next year?

3: You plan to go to college in five years. The school you want to attend costs $15,000
for tuition this year. You know that college tuition costs increase about 9% each year
compounded annually. How much can you expect your first year of college to cost. How
much will the full four years cost?

4: The bank expects housing values to grow at 5% annually over the next 30 years. It
wants its loan interest priced at a 4% margin over inflation. What rate will it charge for 30
year mortgage loans? If a loan applicant wants to borrow funds for a $110,000 house,
what does the bank expect the house to be worth next year? In 3 years? In 5 years? In 10

5: The bank earned an average of 10% on its loans last year and paid out an average of
4% on its deposits. If the bankís tax rate on profits was 30%, what profit did the bank
make if its loans and deposits each totaled $2,000,000 and the bank did not have any other
income producing investments?

A key for these problems is provided in the Associated File
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