Analyze Data on the 1929 and 2008 Stock Market Crashes to Decide on a Future Investment Strategy (Copy and Paste)
Overview
Students create graphs comparing the stock market crashes and recoveries from 1929 and 2008. Students analyze the graphs to make conclusions about the risks and benefits of stock investment. Students use the decision making dimensions and their analysis of the data to decide on an investment strategy for the future.
This lesson plan was created by a participant of the 2020-21 Decision Education Fellowship, hosted by the Alliance for Decision Education.
Lesson Description
Lesson Author
Frank McVey
Lesson Description
Students create graphs comparing the stock market crashes and recoveries from 1929 and 2008. Students analyze the graphs to make conclusions about the risks and benefits of stock investment. Students use the decision making dimensions and their analysis of the data to decide on an investment strategy for the future.
Lesson Objectives
Students will be able to:
Analyze the impact of the 1929 and 2008 stock market crashes
Create stock market graphs from the Great Depression and Great Recession Eras and use the data to evaluate the risks and benefits of investing in stocks
Utilize the decision making dimensions of clarifying values and making predictions to decide on a future investment strategy based on the data from the graphs
Lesson Requirements
Students should have knowledge of the following:
Causes of the Great Depression
Stock shares
Ways to make money investing in stocks (increase in value and dividends)
Creating and reading line and bar graphs
This lesson plan should take three class periods, or 2-3 hours, to teach
Deciding and Critical Thinking Skills
This lesson emphasizes the Clarifying Values [CV] and Predicting [P] Deciding Skills, as well as the Analysis [A], Evaluation [EV], and Explanation [EX] Critical Thinking Skills.
Standards Alignment
D2.Eco.11.9-12, D4.2.9-12, D2.His.1.9-12
Materials and noticeable setup requirements
Lesson Procedure
Day 1
Warm Up (anticipatory set) - 5-10 minutes (depends on discussion)
Students calculate how much money they would have made if they had invested in Apple stock in 2003. You might consider updating the stock price to match the current price and pulling up a live chart of Apple stock to project to the class. Students find it interesting that the price is changing while you talk and it can spark discussion. The purpose is to generate interest and give students an overview of why people invest in stocks.
Create Groups and Graphs - 20-30 minutes (paper graphs take longer)
Create groups of about 4 students and assign each group to make one of the three graphs using the data included in the handout. Students can create big graphs on large paper to display around the room or they can create the graphs on the computer and share them with the class.
Analyze the Data/Graphs - 10 Minutes
Students “tour” the three graphs to see what conclusions they can make about stock investing and the two market crashes/recoveries. It is important that they view each graph because the graphs cover different time periods. Students answer three “analysis” questions built into the handout about the graphs.
Day 2 (could be a one day lesson if have 1.5 hour classes)
Set - 5 Minutes
Students read the Framing section and discuss the 2 investment options in the scenario. Clarify student questions and make sure they understand they are choosing between taking the risk of investing in stocks or the insured savings account.
Generating Alternatives - 5 Minutes
Students read and discuss the four investment strategies that they can choose from. Students should discuss what the options mean in their groups and the teacher should ask questions to check for student understanding.
Clarifying Values - 10 Minutes
Students should generate and rank three values (goals/considerations) that are important for their decision on the investment strategy. Making money is the obvious value. The challenge for students is to identify other values like dealing with the anxiety of fluctuating stock values. This should be done in groups and record in the handout.
Predicting - 10 Minutes
Students should discuss possible outcomes from each investment strategy and record some of their predictions in this section of the handout.
Decision/Exit Ticket - 15 Minutes
Students should discuss the decision on their investment strategy with their group. The student exit ticket is to complete the decision section of the handout by writing down their chosen investment strategy and answering the three bulleted questions to explain their reasoning. This exit ticket could be completed on the handout (on paper) or could be set up to submit to the teacher electronically so the teacher can review and provide feedback on the evidence students used to support their decision.
Class Discussion - 10-15 Minutes
The teacher should lead a class discussion where students can explain their decision and their reasoning. Encourage students to use and point to specific examples from the stock graphs to explain their analysis.
Enrichment - Optional
For students that finish early, there is a link to a New York Times article covering how long it took for investors to recover from the 1929 crash. Students should analyze why the recovery was actually faster than it looks on the graphs (the graphs do not factor in dividends collected by investors over the years). Students create a PPT slide that explains how long it actually took for investors to recover and there are additional slides they can work on as directed. If there is time, students can present some or all of these slides to the class.