TCSS ECONOMICS: Unit 3 MACROECONOMICS (part 1) Unit Essential Question: How are the overall levels of income, employment, and prices are determined by the spending and production decisions of households, businesses, and government? TIME FRAME: 25 Days Capstone Requirements During this Unit December 9th Portfolio Check #2 December 13th – 20th Provide class time for students to work on Capstone

Unit Resources: I do – We do – You do – Teacher notes p. 53-68 Align the Stars review Unit 3 map Macro Into Align the Stars review questions Unit 3 part 1 standards questions Macro tie it together activity Unit 3 part 1 practice assessment questions Business cycle Macro activity

Concept 1: Gross Domestic Product (4 days)

SSEMA1A: Explain that overall levels of income, employment, and prices are determined by the spending and production decisions of households, businesses, government, and net exports. SSEMA1B: Define Gross Domestic Product (GDP), economic growth. SSEMA1C: Explain how economic growth is calculated.

Lesson Essential Question: How does Gross Domestic Product measure economic growth?

Enduring Understanding/Theme: Individuals, Groups, Institutions / Technological Innovation / Rule of Law

KNOW UNDERSTAND BE ABLE TO DO (DOK 2+)  Gross Domestic Product  What is included in calculation of GDP  Categorize specific items based on inclusion  Economic growth  What is not included in calculation of GDP in GDP  Consumption  GDP expenditure model  Explain components of expenditure model  Investment GDP = C+I+G+(X-M) and how spending impacts economic  Government spending  Correlation of increased/decreased growth  Net Exports (Exports, Imports) spending on GDP and growth

1 Sample Formative Assessments:

Products that would be used in calculating GDP include a. plastic made in a factory in Alabama and sold around the world to make toys b. cars made in Texas at a factory owned by a Japanese automobile company. c. cotton cloth manufactured in India and sold to clothes makers in the US. d. toys manufactured in China at a factory owned by a U.S. company.

Country X has decided that economic growth will be their primary goal for the next several years. The best way to achieve this would be to A. reduce amount of government spending B. invest heavily in stock market. C. decrease imports from other countries to focus on exports. D. invest in capital and education of workers.

RESOURCES: I do – We do – You do –

GDP --- http://prezi.com/qghf_pdo_yxc/gross- GDP 15 Application scenarios Gross Domestic Product DOF 1 domestic-product/\ Gross Domestic Product DOF 2 Gross Domestic Pizza activity Gross Domestic Product DOF Key GDP PowerPoint GDP Practice

2 Concept 2: Business Cycle (2 days)

SSEMA1A: Explain that overall levels of income, employment, and prices are determined by the spending and production decisions of households, businesses, government, and net exports. SSEMA1E: Define the stages of the business cycle; include peak, contraction, trough, recovery, expansion as well as recession and depression.

Lesson Essential Question: How is the business cycle used to track economic growth/decline over time?

Enduring Understanding/Theme: Individuals, Groups, Institutions

KNOW UNDERSTAND BE ABLE TO DO (DOK 2+)  Business Cycle  How each phase of the business cycle  Create a business cycle including phases  Expansion/Recovery reflects the current status of an economic and points  Contraction/Recession system  Interpret how an economic system is  Peak  How to label and interpret the business performing based on the phase of the  Trough cycle business cycle  Trend line  Target growth rate for an economy (trend  Extrapolate a nation’s economic  Real GDP line: 3-7%) performance based on its business cycle  Phase of business cycle  Connection between GDP and phase of over time  Depression business cycle Sample Formative Assessments:

If an economy experiences the following: 12% inflation (very high), 2.5% unemployment (very low), and high investment, they are MOST LIKELY on which part of the business cycle? A. Trough B. Expansion C. Recession D. Peak

If an economy is in a trough on the business cycle A. unemployment is high, real GDP growth is high, and inflation is low B. unemployment is low, real GDP growth is low, and inflation is low C. unemployment is low, real GDP growth is high, and inflation is high D. unemployment is high, real GDP growth is low, and inflation is low RESOURCES: I do – We do – You do –

Business Cycle --- GDP and Business cycle poster Business Cycle Practice http://prezi.com/0yi0j4ge9wze/business-cycle/

3 Concept 3: Unemployment (4 days)

SSEMA1A: Explain that overall levels of income, employment, and prices are determined by the spending and production decisions of households, businesses, government, and net exports. SSEMA1B: Define unemployment SSEMA1C: Explain how unemployment is calculated. SSEMA1D: Identify structural, cyclical, and frictional unemployment.

Lesson Essential Question: How do the various types of unemployment impact an economy?

Enduring Understanding/Theme: Scarcity / Technological Innovation / Individuals, Groups, Institutions

KNOW UNDERSTAND BE ABLE TO DO (DOK 2+)  Unemployment  Connection between unemployment rate  Differentiate which type of unemployment  Frictional and phase of business cycle based on specific scenarios  Structural  The difference between types of  Calculate unemployment rate  Cyclical unemployment  Difference between unemployed and not  Labor force  How to calculate unemployment part of labor force  Unemployed (#unemployed/labor force x100)  Underemployed  Full employment Sample Formative Assessments:

A recent college graduate applied to work at the KIA factory in WestPoint that you have worked at for two years. Your boss informs you that you are being replaced by the college graduate and you now have to find a new job. What type of unemployment is being described? A. Cyclical B. frictional C. Structural D. seasonal

A person trying to find the unemployment rate in a country needs which two pieces of information? A. The total number of jobs and the number of people without jobs B. The number of unemployed people and the population C. The number of unemployed people and the number of discouraged workers D. The number of unemployed people and the number in the labor force

4 RESOURCES: I do – We do – You do –

Unemployment --- Unemployment charades Unemployment practice http://prezi.com/vnlbhmvywcxo/unemployment/ Unemployment identification activity

Unemployment PowerPoint Unemployment game Unemployment game 2

Concept 4: Inflation (4 days)

SSEMA1A: Explain that overall levels of income, employment, and prices are determined by the spending and production decisions of households, businesses, government, and net exports. SSEMA1B: Define Consumer Price Index (CPI), inflation, stagflation SSEMA1C: Explain how inflation is calculated. SSEPF3A: Give examples of who benefits and who loses from inflation.

Lesson Essential Question: How does inflation impact an economy?

Enduring Understanding/Theme: Individuals, Groups, Institutions / Scarcity / Technological Innovation

KNOW UNDERSTAND BE ABLE TO DO (DOK 2+)  Inflation  Connection between inflation and phase of  Describe the effect on price level during a  Stagflation business cycle period of inflation, deflation, or stagflation  Deflation  Difference between inflation, stagflation,  Explain how inflation, deflation, stagflation  Price level and deflation impacts an economy  Market Basket  What occurs to price level during inflation,  Assess how inflation is calculated based on  Consumer Price Index deflation, and stagflation looking at a set market basket of items  Inflation Rate  How to calculate Inflation rate using CPI  Discern how inflation impacts various  Fixed income/salary and market basket income levels, savers/spenders, and  Cost of living adjustments  Components of market basket financial institutions.  Financial institutions  How inflation impacts different groups/incomes

5 Sample Formative Assessments:

Which person would be hurt the MOST by sudden inflation? A. Jim, who gets a raise every year. C. Sally, with a fixed rate mortgage. B. Pedro, who earns dividends on stock. D. Marie, who is on a fixed salary.

Which of the following would be a result of stagflation? A. Inflation, high employment, and increased demand C. Deflation, unemployment, and decreased demand B. Inflation, unemployment, and decreased demand D. Deflation, high employment, and increased demand

Consumer Price Index measures: A. Inflation B. depressions C. GDP D. supply and demand

RESOURCES: I do – We do – You do –

Inflation --- Focus Lesson 18 Too Much Money (questions) http://prezi.com/bn9i94tnyjaj/inflation/ Inflation Intro Auction Inflation practice Too much money videos

Concept 5: Aggregate Supply and Demand (3 days)

SSEMA1A: Explain that overall levels of income, employment, and prices are determined by the spending and production decisions of households, businesses, government, and net exports. SSEMA1B: Define aggregate supply and aggregate demand.

Lesson Essential Question: How do aggregate demand and aggregate supply influence levels of economic growth, price level, and the business cycle?

Enduring Understanding/Theme: Individuals, Groups, Institutions / Technological Innovation / Scarcity / Rule of Law

KNOW UNDERSTAND BE ABLE TO DO (DOK 2+)  Aggregate  Connection between aggregate  Interpret aggregate supply and aggregate  Aggregate Demand supply/demand and phase of business cycle demand shifts on a graph  Aggregate Supply  Factors/Determinants that cause shift in  Illustrate how a shift in aggregate supply  Determinants/Factors Aggregate Supply or aggregate Demand and aggregate demand impact equilibrium  Effect of changes in aggregate supply or  Predict how aggregate supply and aggregate demand on equilibrium aggregate demand dictate price level and

6  Draw Aggregate supply and demand graphs output  Distinguish between a shift in aggregate supply or aggregate demand Sample Formative Assessments:

A shift from AS2 to AS1 results in A. an decrease in price level B. an increase in price level C. an decrease in Real GDP D. a decrease in aggregate demand

Concern about an international crisis has caused Businesses across America to stop making goods and save their money to see what the future brings. What is the effect on aggregate demand and aggregate supply? a. aggregate demand will decrease, lowering both GDP and the price level b. Both aggregate demand and aggregate supply will decrease, leading to lower GDP c. No change in aggregate supply or demand d. aggregate supply will decrease, raising the price level and lowering GDP

RESOURCES: I do – We do – You do –

Aggregate Supply and Demand --- Focus Lesson 19 Aggregate Supply and Demand practice http://prezi.com/dpt3t19ltb1k/aggregate- supply-and-demand/ Class Review ADAS Class Review ADAS graph

7