Related Capstone Lessons

Unit 2: Lesson 10 - Equilibrium Prices and Equilibrium Quantities

In examining a visual about the market for yo-yos, students think through the process of mutual accommodation among buyers and sellers that results in an equilibrium price. Students then complete an activity plotting supply and demand curves in the market for Frisbees, identifying the equilibrium price and quantity under different conditions.

Concepts:

  • Demand
  • Equilibrium Price
  • Quantity Demanded
  • Quantity Supplied
  • Shortage
  • Supply
  • Surplus
Standards:
  • Standard #7: Markets and Prices
  • Standard #8: Role of Prices

Unit 2: Lesson 13 - How Markets Allocate Resources

Students read I, Pencil, by Leonard Read, to gain an understanding of Adam Smith's concept of the invisible hand of the marketplace. Students see that a system of market prices brings about cooperation without coercion. Then students use supply and demand analysis to explain how a change in one market tends to affect related markets.

Concepts:

  • Markets
  • Supply
  • Complements
  • Invisible Hand
  • Secondary Effects
  • Substitute
Standards:
  • Standard #7: Markets and Prices
  • Standard #8: Role of Prices

Unit 2: Lesson 7 - A Silver Market

Students participate in a simulation activity that shows how a competitive market works. Although most markets for goods and services are not as competitive as the silver commodity market, the example helps students gain an understanding of how prices are set in any market.

Concepts:

  • Choice
  • Competition
  • Demand
  • Incentive
  • Markets
  • Supply
  • Consumer Surplus
  • Producer Surplus
  • Consume
Standards:
  • Standard #4: Incentives
  • Standard #7: Markets and Prices

Unit 2: Lesson 9 - A Picture Is Worth a Thousand Words: Supply

Students analyze the relationship between changing prices and changes in producer behavior. They create a supply schedule graph to represent this relationship. They observe changes in determinants of supply and note the effect of those changes on the supply schedule and the corresponding price-quality relationship.

Concepts:

  • Price
  • Supply
  • Determinants of Supply
Standards:
  • Standard #4: Incentives
  • Standard #8: Role of Prices

Unit 6: Lesson 35 - Fiscal Policy: A Two-Act Play

Groups of students are given outlines for one of two acts in a play describing either expansionary or contractionary fiscal policy. After choosing parts and preparing lines for their roles, two groups are chosen to perform the play. Events in the play are discussed by reference to concepts of fiscal policy. More advanced classes may then discuss current debates about the effectiveness of fiscal policy.

Concepts:

  • Supply
  • Fiscal Policy
  • Contractionary Fiscal Policy
  • Crowding-Out
  • Expansionary Fiscal Policy
  • Multiplier Effect
  • Supply-Side Fiscal Policy
Standards:
  • Standard #20: Fiscal and Monetary Policy

Unit 7: Lesson 42 - Foreign Currencies and Foreign Exchange

Students participate in a simulated foreign exchange market. The exercise provides an opportunity for students to use supply and demand analysis to explain how flexible exchange rates are established in currency markets.

Concepts:

  • Demand
  • Exchange
  • Supply
  • Foreign Exchange Market
Standards:
  • Standard #5: Trade

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