When I first moved to the U.S. six years ago, I wondered at how I would be able to survive in a country that has people that judge each other based on the color of their skin. After a few years of dealing with the problem of racism, I came up with a "guide" on how to respond to racism and what the consequences of the action I take has.
When someone makes a racist joke against you, you can:
1) Ignore it
2) Make a racist joke back at them
3) Tell someone
4) Beat them!
Now lets look at what happens if you pick one of the options above.
1) Ignoring it wont make it stop. And as time goes on, the jokes will only get worse which will lead you to stop ignoring the problem and move on to a different solution.
2) Making a racist joke back at them will only piss the person off. Which will lead to other creative jokes. And over time, you find a new action to take against the racist person.
3) Telling someone, a counselor or a teacher, will make the racist person sit down with the person you told and they might get detention or even expulsion from school. Usually, the racism stops there. However, it is possible that the person might come back to school with a vengeance and you are number one on his hit list.
4) If the jokes don't stop, you might have to resort to the final action, beating them! If the jokes never stop and you challenge the person to a fight, AND WIN, the jokes are sure to stop. However, if you lose, you are screwed for life.