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LESSON: ALEXANDER, WHO USED TO BE RICH
LAST SUNDAY
Lesson Summary
Alexander
had a dollar last Sunday, but he just can’t seem to hang on to it.
Follow Alexander through the week as he makes many poor spending
decisions, resulting in his not saving anything!
Concept: Saving
Definition: Saving is the part of a person’s
income that is not spent for goods and services or used to pay
taxes. People can earn interest on the money they
save.
Comprehension Questions
How
much money did Alexander get last Sunday from his Grandma and
Grandpa?
$1.00
What
could Alexander do with the money he received?
He could
spend it to purchase goods and services. He also could
save the dollar or give some or all of it away.
If
people earn money through their work, what else will happen?
They
will have to pay taxes to the government.
What
was Alexander’s main problem in the story?
He simply couldn’t keep
from spending his scarce money or losing it through unwise
decisions.
Give some
examples of the poor decisions Alexander made that kept him from saving
his money.
He bought
goods such as gum and a used candle, deck of cards, and stuffed
bear. He also purchased services that he later regretted, such as
snake rental and magic tricks. He also tried betting and lost, and also
was fined by his parents for careless, unkind remarks.
In the
story Alexander said, “Saving is hard.” Why is saving hard for many
people? Saving requires the discipline to forgo current consumption
in order to enjoy consumption later on. (Hopefully more
consumption, because of the interest earned on savings.)
Where
do people often save their money?
People often save at a bank or
credit union, using savings accounts, money market accounts, certificates
of deposit, etc. People also purchase stocks and bonds with their
savings in the hope of earning dividends and interest.
Why do
people save their money at a bank or credit union?
They usually
earn interest on their savings deposits.
What
does the bank usually do with the savings deposits?
The bank
usually loans the savings deposits to other consumers or to business
people. In the hope of making a profit, the bank charges a higher
rate of interest than the interest rate it pays on deposits.
Other
Concepts: Economic
Wants, Scarcity, Goods and
Services, Investing | 
