Johnny can't read, write, or recite his multiplication tables very well, say the critics. But a survey sponsored by The Hearst Corp. indicates that Johnny's parents have a thing or two to learn as well, particularly about business.
For example, 55% of the people surveyed said that the "suggested retail price" on packages is the price recommended to a manufacturer by the Federal Trade Commission. And 64% didn't know the size of the federal budget deficit.
The survey, conducted last summer by Research & Forecasts Inc., worries some economists. "A large deficit, for example, is crucial," says Marjorie Honig, who chairs the economics department at Hunter College, City University of New York. "It can hurt the economy in many ways. But voters didn't seem to care about it at all in this last election. The problem is that the general populace has no sense of how devastating a large deficit can be."
The deficit is not the only blind spot. Forty-eight percent of those surveyed wrongly state that the gross national product is the total value of all goods and services that will be purchased by federal, state, and local governments in one year. Twelve percent can't give any definition of the GNP.
Regarding the private sector, 84% don't know that America's largest corporations retain less than 10? on the dollar as aftertax profits, and 76% mistakenly believe the Dow Jones Industrial Average is the average stock price given in dollars and cents of selected companies traded on the New York Stock Exchange.
Honig blames the public education system for this general ignorance about business and economics; the two subjects have become standard fare in high school curricula only recently. Still, educators may have a hard time getting peple to class. Hearst reports that 43% of those surveyed say they are comfortable with their current level of economic knowledge.