Gender schema theory suggests that once children understand their gender label, they:

Answer: labeling themselves as well as other individuals by gender (i. e.-male or female)

Explanation:

Gender schema theory is the concept that states about individuals or society that tend to categorize the gender in cognitive process. People use their knowledge, role etc to generate sex type characteristic for other individuals.

Children tend to understand the gender roles way earlier than they understand consistency of gender. They also relate with the characteristics based on gender to label other people as male and female.

This congnitive process provides guidance to children to understand scheme of gender and the function of transmitting roles and features accordingly to other people.