Launch: Taking Financial Risks

Set up a mock investment challenge: Each student starts with $1,000 (in pretend money) and must allocate it among different investment options (e.g., stocks, savings, starting a business). Some options are riskier with higher potential returns, while others are safer but yield less. Provide updates on the “market” at intervals.

Socratic Questions:

1. What influenced your choice between high-risk and low-risk investments?
   • A) Do you prioritize potential for higher returns, or do you focus more on security and stability?
   • B) Do you tend to trust your instincts about risk, or do you rely on past experiences and research to guide your decisions?
2. How do you weigh potential gains against possible losses?
   • A) Do you consider the potential for loss more seriously than the chance of gain, or is it the opposite for you?
   • B) When comparing risk and reward, do you focus on the probability of success, or do you think more about the magnitude of the consequences if things go wrong?
3. How might your approach to risk change depending on your financial situation?
   • A) Does a more stable financial situation make you more willing to take risks, or do you remain cautious regardless of your financial state?
   • B) If facing financial uncertainty, do you tend to play it safe and avoid high-risk investments, or do you see potential high-risk opportunities as a chance for greater returns?

Challenge: “The Investment Challenge”

Why This Approach Works

   Engagement: Role-playing and simulations make financial concepts tangible and relatable.
   Critical Thinking: Students must weigh trade-offs, analyze options, and justify their decisions.
   Reflection: Socratic questions help students connect the activity to real-life challenges and develop financial literacy skills.