This poor high school background is not limited to math. Results from the first-ever national tests in history and literature are equally troublesome. Diane Ravitch and Chester Finn, in their book What Do 17-Year-Olds Know?, report that only one in three could place the Civil War as occurring sometime between 1850 and 1900. Only one in seven could identify Alexis de Tocqueville.

Though one must be careful about inferring casualty, there is a positive correlation between scores on these tests and time spent doing homework. Fewer than 40 percent of high school seniors average at least an hour per day on homework. Students on average spend triple the time watching TV as doing homework. Those who watched TV six or more hours per day had the lowest test scores. On average, high school seniors also spend more time on part-time jobs than on homework.

Thus, many students fail to develop good study habits in high school. Because of current demographics, however, few colleges can afford to be truly selective, so a mediocre high school performance is not necessarily a bar to college admission. The challenge for us is how to teach those who enter college with such a limited background and with such poor study habits.

My focus here is to study habits. One way to help students is to be quite explicit about what is expected from them. The place to begin is with the syllabus, which should provide detailed guidance about reading assignments, exams, and other information that might help the student who has little idea what to expect. In your syllabus or in your introductory remarks, you might also convey the nature of your exams and the level of mastery you expect. As Art Welch of Penn State says, our course should not be like some giant Easter egg hunt.

You might consider suggesting no only how to study but how much to study. I tell students that when they read the textbook, they should assume that every paragraph makes a point. As they read, they should be continually asking themselves, "What's the point?" With regard to graphs, I tell students that the level of mastery I expect is the ability to draw, label, and explain each graph without reference to the book or to class notes.

In terms of how much to study, I tell students I expect them to spend at least two hours studying for every hour of class. Student study time is the most elastic resource in the course, and it often goes untapped. We should keep in mind that even full-time students who never miss a class spend less than 10 percent of their total time in class. If we don't lay claim to some of the remaining 90 percent as study time for our course, other instructors and other activities surely will.

Thus, we must recognize that including more of one topic usually involves a tradeoff. Sometimes textbook authors apparently avoid making hard choices by simply adding another section or another chapter to cover the latest timely topic. But since principles textbooks typically include more material than can reasonably be covered in a term, since the college term remains fixed, and since students appear less prepared than ever, the instructor's choice of topics becomes all the more critical.

What we need in making choices about international coverage is a place to stand, a perspective. I believe a tool we teach early in the term, the production possibilities frontier, might provide such perspective. The production possibilities frontier in the accompanying exhibit reflects possible combinations of international material and other material that can be covered during the term, given the available teaching technology and available resources (e.g., instruction time, student study time, books, support materials, and so on).

Notice that, as drawn, this frontier has more of a bulge than usual. Here's why. At point A course resources are employed exclusively to cover non-international topics. But some international topics, such as comparative advantage, shed light on the core of economic principles. So the introduction of such international topics allows for fuller coverage of non-international topics. The move from point A to point B involves taking up those international topics that help students understand non-international topics as well. Thus the move from point A to point B increases coverage of both topics.

Once point B is reached, coverage of additional international topics involves an opportunity cost, but that cost is initially quite low. Some international coverage easily piggy-backs on core topics. For example, once such core topics as inflation, unemployment, and market structure have been introduced, comparative data for key countries around the world can be added at little opportunity cost. So the slope to the right of point B is initially somewhat flat because references to other countries do not require a new theoretical framework.

Other international topics, however, build on the existing theory in a way that involves a greater degree of complexity. For example, once the aggregate expenditure function is introduced, the addition of net exports to the model requires further explanation. Likewise, fiscal and monetary policies become more complicated in an open economy. Thus, the slope becomes steeper to reflect the greater opportunity cost of these additional international topics. A still higher opportunity cost involves topics that must be developed largely from whole cloth, such as the J-curve.

Thus, the movement from B to C reflects an increasing opportunity cost as one moves from international topics that are easy picking to those topics that rely little on non-international material. Once at point C, attempts to cover still more international topics cut so much from the core of principles topics, that students would be unable to grasp even the level of international covered at point C. So as the instructor attempts to cover still more international material, coverage of both topics declines, as reflected by points from C to D.

Since it would be irrational to operate on the upward sloping portions of the frontier, we can rule out points along these two extreme ranges. Consequently, the real choice lies along the range from B to C.

Notes that points along the frontier reflect a given amount of student study time. Prompting students to study more, ceteris paribus would shift out the frontier. (Sounds good to me.) Of course, even to get on the frontier, we must be using the given resources efficiently. Some of us may be experiencing a form of X-inefficiency by failing to use the best technology or by making poor use of the blackboard, student time, handouts, overhead displays, events in the daily newspaper, textbooks and supplementary materials.

Did you ever burn the roof of your mouth biting into a slice of pizza before it had cooled sufficiently? Have you done this more than once? Why does such self-mutilation persist? It persists because that bite of pizza is worth more to you now than the same bite five minutes from now. In fact, you are even willing to risk burning your mouth rather than wait until the pizza has lost its destructive properties. In a small way this phenomenon reflects the fact that you and other consumers value present consumption more than future consumption: you and other consumers have a positive rate of time preference.

(Economics: A Contemporary Introduction, 2nd Ed., South-Western Publishing Co., 1991, p.699)

One good mental picture is worth many dry words. We should always be on the lookout for fresh material. We should conjure up all our powers of observation to "sensationalize" our lectures. When I come across something that will help students see the point, I write it down--I stab it with a pen. Remember the Chinese proverb: "The palest ink is more reliable than the strongest memory."

There is I believe a hidden benefit imparted to those who search for clear and direct expressions of economic phenomena: in doing so, we gain a deeper understanding of the economic theory under consideration. As T. H. Huxley noted, "Some experience of popular lecturing had convinced me that the necessity of making things plain to uninstructed people was one of the very best means of clearing up the obscure corners of one's own mind."

I think a lot of good teaching is the result of forming good habits. As William James said, "We must make automatic and habitual, as early as possible, as many useful actions as we can. . . . The more of the details of our daily life we can hand over to the effortless custody of automatism, the more our higher powers of mind will be set free for their own proper work." So form good habits, then make them your master.

• According to data found in the Economic Report of the President, net interest on the federal debt climbed from $52 billion in 1980 to an estimated $197 billion in 1991. This amounted to 21 percent of federal individual income taxes collected in 1980 but 40 percent in 1991. The federal debt carries a very real cost.

• During the era of competing moneys, prior to the National Banking Act of 1863, each bank could issue its own bank notes. More than 10,000 different kinds of notes circulated in the United States and nearly all were redeemable for gold. To redeem a note, the bearer had to present it to the issuing bank. To discourage redemption, some banks located out in the sticks--out where the wildcats lived. Thus, this period of banking became known as the "wildcat era." Most well known notes were counterfeited.

• An update of the world's wealthiest people, by Forbes (July 22, 1991), finds Taikishito Mori of Japan ranking first in 1991. Mori, you may recall from an earlier newsletter, is the retired economics professor who made it big in Japanese real estate.

• Although economists do not like to explain choice by resorting to changing tastes, the tastes for certain kinds of jobs do appear to change over time. Adam Smith claimed that entertainers had to be paid well because of the humiliation they subjected themselves to by performing. Few would argue this is true of today's successful entertainers. Some professions seem to fall in and out of favor. During the 1960s, careers in business were viewed unfavorably by many of the nation's brightest college graduates--not so in the 1980s. Some observers argue that the TV show "L.A. Law" has rekindled applications to law schools.