Assignment: Short-Run Economic Fluctuations
Purpose of Assignment
Students will example the model economists use to analyze the economy's short-run fluctuations--the model of aggregate demand and aggregate supply. Students will learn about some of the sources for shifts in the aggregate-demand curve and the aggregate-supply curve and how these shifts can cause fluctuations in output. Students will be introduced to actions policymakers might undertake to offset such fluctuations. Students will see why there is a temporary trade-off between inflation and unemployment, and why there is no permanent trade-off.
Assignment Steps
Resources: National Bureau of Economic Research
Select an organization your team is familiar with or an organization where a team member currently works.
Create a 15- to 20-slide Microsoft PowerPoint presentation to present to the organization's Executive Committee.
Include the following items:
• Identify the three key facts about short-run economic fluctuations and how the economy in the short run differs from the economy in the long run.
• Explain economic fluctuations and how shifts in either aggregate demand or aggregate supply can cause booms and recessions using the model of aggregate demand and aggregate supply.
• Explain how monetary policy affects interest rates and aggregate demand.
• Analyze how fiscal policy affects interest rates and aggregate demand.
• Evaluate why policymakers face a short-run trade-off between inflation and unemployment.
• Evaluate why the inflation-unemployment trade-off disappears in the long run.
Format your PowerPoint in the following way:
* every slide must have a relavant visual
* bullet points, NOT complete sentences, should appear on the slides
* references should be provided and printed in APA format
* Only Peer-reviewed references are acceptable
Presentation In Class:
* The team will present their Powerpoints to the class. You must know your content - you can use note cards, but you may not read.
* An activity, which relates to the presentation, will be done with the class. (Be creative)