The Economics segment of the recently introduced NCERT Social Science textbook for Grade 9, Part 2, includes chapters on personal finance and entrepreneurship, introducing students to essential financial concepts and the fundamentals of running a business.
Sharing details of the new chapters, Sanjeev Sanyal, a member of Prime Minister Narendra Modi's Economic Advisory Council, said students will learn the basics of fixed deposits, mutual funds, equated monthly instalments (EMIs), taxes, risk, and returns, among other topics. The objective is to equip students with practical financial knowledge and useful life skills.
In a post highlighting the changes, Sanyal said the textbook also includes a chapter on entrepreneurship. It introduces students to concepts such as profit and loss accounts and business plans while presenting risk-taking, innovation, and business activities in a positive light.
He said this approach was different from that of the previous textbook, which, according to him, placed emphasis on concepts such as hoarding and black markets.
NCERT Class 9 Economics Chapter On Personal Finance: What Will Students Learn?
The chapter on personal finance introduces students to the importance of managing money and making informed financial decisions. It covers questions such as what personal finance is, why it matters, the key pillars of personal finance, common savings and investment options, ways to protect savings and assets, and income tax.
The chapter begins by asking students to reflect on their experiences with money, such as receiving pocket money or money from relatives during festivals, and how they usually spend or save it.
Students are encouraged to consider questions such as:
- Do you spend your money immediately or save some of it?
- Do you keep your savings in a piggy bank (gullak) or somewhere else?
- How do you manage expenses such as travelling to school, buying stationery or purchasing food from the school canteen?
- Have you ever planned your spending to save money for something you wanted to do later, such as visiting your grandparents during the summer break?
Explaining the importance of financial planning, the chapter states that managing money begins in childhood. As individuals grow into adulthood, they earn income and spend it to meet their needs and wants. They also save and invest to achieve financial goals, such as buying a house or funding higher education.
It further explains that individuals and households make several financial decisions and that money is an important resource that needs to be used efficiently.
The chapter defines personal finance as the planning and management of an individual's money to meet their needs and wants. It involves making informed decisions about spending, saving, and investing.
Savings, Investments And Risk-Return
Students will also learn about different savings and investment options, including the relationship between risk and returns.
The chapter explains that investments with lower risk generally offer lower returns, while those involving higher risks may offer higher returns. It also highlights the importance of choosing investments according to an individual's financial goals, willingness to take risks and the time at which they are likely to need the money.
What Will Students Learn About Taxes?
The chapter introduces taxes as compulsory payments made by individuals and businesses to the government to fund public services and essential facilities, including schools, hospitals, transport and defence.
Students will learn about the following types of taxes:
1. Direct taxes: These are paid directly by individuals or organisations on their income or profits. Income tax is an example.
2. Indirect taxes: These are added to the prices of goods and services. The Goods and Services Tax (GST) is an example.
3. Personal income tax: This is the tax paid on the income an individual earns during a financial year, which runs from April 1 to March 31. Individuals whose income falls below the prescribed exemption limit are not required to pay income tax.
The chapter also explains why an understanding of personal finance is important and how individuals can manage their finances effectively.
NCERT Class 9 Entrepreneurship Chapter: From Ideas To Startups
Another chapter in the Grade 9 Social Science textbook, titled 'From Ideas to Startups', introduces students to entrepreneurship and its role in society and the economy. It explores key questions such as how entrepreneurship affects society and the economy, what the functional areas of a business are, and how to develop a business plan.
The chapter begins with a practical classroom activity. Students are asked to imagine that their school is organising an annual festival and they are participating in a 'Young Entrepreneurs Challenge'. As part of the activity, students have to develop a product or service for parents and children visiting their stall. They decide to set up a lemonade (nimbu pani) stall. At the end of the day, they are required to prepare a report detailing the expenses incurred and the profit earned and submit it to their class teacher.
Through this activity, students will learn about the basic elements of entrepreneurship, including market, activities, strategy, analysis, goals, innovation, artificial intelligence (AI), opportunities, teamwork, and performance.
The chapter also explains profit as the money earned from trade or business after deducting the costs of producing and selling goods and services.
Using the lemonade stall example, students are encouraged to understand whether their business activity resulted in a profit or a loss.
Explaining the concept of entrepreneurship, the chapter states that the activity captures the essence of running a business through planning, organising, and learning by doing. It defines entrepreneurship as a process through which an individual or a group of individuals converts a potential idea into a business venture.
What Are The Four Functional Areas Of A Business?
The entrepreneurship chapter also introduces students to the four key functional areas of a business, explaining how each contributes to its overall growth and success.
1. Management and Operations
This area focuses on managing day-to-day business activities and ensuring efficient processes and smooth operations.
Examples include production, quality control and supply chain management.
2. Finance and Accounting
This area deals with managing money, maintaining financial health, and ensuring effective budgeting.
Examples include budgeting, financial reporting, and cash flow management.
3. Human Resources
This area focuses on managing people and ensuring that a business has the right employees and skills.
Examples include hiring employees, managing employee benefits, and resolving workplace conflicts.
4. Marketing and Sales
This area focuses on creating customer awareness, promoting products and services, and driving sales to support business growth.
Examples include advertising, promotional activities, and sales.
Students interested in exploring the new chapters can access the NCERT textbook through the official website.