Related Capstone Lessons

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 6: Lesson 37 - Can Government Manage the National Economy?

Although economists agree much more often than they disagree, the opinions of prominent economists on economic policy often conflict. This lesson seeks to clarify why economists disagree. Understanding the reasons for disagreement among experts may help students to make their own judgments about economic policies. The lesson concludes by having students compare and contrast the major macroeconomic theories, which are Keynesian and New Classical. New Classical economics includes the Monetarist and Rational Expectations theories.

Concepts:

  • Aggregate Demand (AD)
  • Aggregate Supply (AS)
  • Fiscal Policy
  • Monetary Policy
  • Assumptions
  • Keynesian Theory
  • Monetarist Theory
Standards:
  • Standard #18: Economic Fluctuations

Unit 6: Lesson 38 - Aggregate Demand and Aggregate Supply

Students build their understanding of aggregate demand and aggregate supply. They use their new skills to analyze the effects of events and government monetary and fiscal policies on inflation, unemployment, and economic growth. In the first two Activities, students identify different components of AD and AS and the factors that shift AD and AS. In the last two Activities, students use AD and AS analysis to predict the effect of events and government monetary and fiscal policies on inflation, unemployment, and economic growth.

Concepts:

  • Aggregate Demand (AD)
  • Aggregate Supply (AS)
  • Price
  • Fiscal Policy
  • Monetary Policy
  • Macroeconomic Equilibrium
  • Price Level
Standards:
  • Standard #18: Economic Fluctuations

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