The Number System: 7.NS.

3
Apply and extend previous understandings of operations with fractions to add, subtract, multiply, and divide rational numbers.
3. Solve real-world and mathematical problems involving the four operations with rational numbers.

BACKGROUND
To solve real-world problems, students should be fluent in computing rational numbers. One real-world problem is selecting stocks that are likely to provide a positive return on invested money.

ACTIVITY: PLAYING THE STOCK MARKET

Working rst individually, then in groups of three or four, students will pretend to purchase stocks and calculate their gains or losses. They will analyze and summarize their investments.

MATERIALS
Newspapers and/or computers with Internet access; reproducible, Stock Market Recording SheetExample; reproducible, Stock Market Recording Sheet; reproducible, Stock Market Worksheet.

PREPARATION
If you choose to use newspapers to track the daily performance of stocks, arrange to have enough copies for your students to use during the activity. You might ask colleagues to bring in copies of daily newspapers that contain stock quotes and nancial information. Some students may also have access to newspapers at home. Make enough copies of the reproducibles so that each student has a copy of each one.

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TEACHING THE COMMON CORE MATH STANDARDS

PROCEDURE

1. Explain the basic principles of the stock market to your students. A thorough
summary of the stock market, stocks, and history can be found at the Web site http://library.thinkquest.org/3088/stockmarket/introduction.html. You may wish to summarize this for your students or have them visit this site.

2. Explain that for the rst part of this activity, students will work individually. Ask them to
imagine that you are giving them $1,000 to invest in the stock market. They can purchase stock in one company without exceeding $1,000. They should spend as much of their money as possible on the purchase of stock. Any remaining money will be placed in a bank account; however, doing so will result in no gain because of the short period of time (one week). Students will track their stock for seven business days in order to calculate their gains or losses.

3. Provide newspaper stock listings to your students or direct them to the Web site
http://nance.yahoo.com/ where they can research companies, nd stock prices, examine trends of prices, and track stocks.

4. After students select a company in which to invest, distribute copies of the reproducible, Stock Market Recording SheetExample. The example contains information about the ctional Peach Computer Company. Review the information on the reproducible with your students and explain the terms and meaning of each column. Note that the rst table provides information about the purchase of the stock. The second table includes: The opening price is the price of one share of the stock at the beginning of the day. The closing price is the price of one share of the stock when the stock market closes. Change is the amount of difference for one share of stock in the opening and closing price. This change will be positive if the stock increased in value and negative if the stock decreased in value. Money made or lost represents the amount of money gained or lost for the total number of stocks purchased. For example, ten shares of stock of the company were purchased. To calculate the money made or lost, students must multiply 10 times the change. The net worth represents the total amount of the investment. It is found by multiplying the opening price by the number of shares purchased and adding the money made or lost.

S TA N DA R D S A N D ACT I V I T I E S FO R G R A D E 7

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5. Distribute copies of the reproducibles, Stock Market Recording Sheet and Stock
Market Worksheet. Instruct your students to complete the recording sheet and track their stocks for seven business days, lling out a row on the recording sheet each day. The worksheet provides students with guidance to calculate their net worth. This can be completed during school or at home.

6. After seven days, divide your students into small groups and instruct them to share
their ndings. They should discuss the questions, such as the following: Describe the performance of the stocks of your companies. Did your stocks go up or down? By how much? How much money did you gain or lose during the seven days? What was the percent change for your companies stocks? Why is percent change helpful in making comparisons between companies stocks? Explain how you calculated the amount of money you made or lost during the week. Explain how you calculated the percent change. Ask your students to make predictions by posing these questions: Would you choose these same stocks again? Why or why not? How do you think your company will perform during the next year? Will the stock go up or down? Why do you think this? Who gained the most money in your group? What might be the reason for this?

CLOSURE
Have each group report on one of the questions they answered. Also, discuss as a class things that students found interesting or surprising as they completed this activity.

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TEACHING THE COMMON CORE MATH STANDARDS

STOCK MARKET RECORDING SHEETEXAMPLE

------------------------------------------------------------------------------

Stock

Stock Ticker Symbol

Purchase Price

Number of Shares Purchased

Total Amount Spent

Balance

Peach Computer Company

PCC

$84.17

10

$841.70

$158.30

The amount of money placed in a bank account: $158.30

Copyright 2012 by Judith A. Muschla, Gary Robert Muschla, and Erin Muschla.

Two-Day Chart (for the Stock of the Peach Computer Company)

Change (Positive Day Opening Price Closing Price or Negative) Money Made or Lost Net Worth

1 2

$84.17 $85.36

$85.36 $83.80

+1.19 1.56

$11.90 $15.60

$853.60 $838.00

Equations for determining net worth: Day 1: ($84.17 10) + $11.90 = $853.60 Day 2: $853.60 + ($15.60) = $838.00

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Name

Period

STOCK MARKET RECORDING SHEET

Company Name:
Stock Ticker Symbol

------------------------------------------------------------------------------

Stock

Purchase Price

Number of Shares Purchased

Total Amount Spent

Balance
Copyright 2012 by Judith A. Muschla, Gary Robert Muschla, and Erin Muschla.

The amount of money placed in a bank account:

Change (Positive Day Opening Price Closing Price or Negative) Money Made or Lost Net Worth

1 2 3 4 5 6 7

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Name

Date

STOCK MARKET WORKSHEET

-----------------------------------------------------------------------------Equations for Determining Net Worth: Day 1: Day 2:

Copyright 2012 by Judith A. Muschla, Gary Robert Muschla, and Erin Muschla.

Day 3: Day 4: Day 5: Day 6: Day 7: How much money did you deposit in the bank? Original net worth as of Day 1: Final net worth as of Day 7: Total change: (Final net worth on Day 7)(Original net worth on Day 1) = Percent Change: (Remember that to calculate percent change you must analyze the ratio of Total Change to Original Net Worth on Day 1 and convert this ratio to a percent.) Total net worth (including money in the bank):

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