Connecting Economics and Government

Paul Solman Video: Steering the Course

Re-explain the analogy between Homer's Odyssey and our economic goals Scylla (Inflation) Charybdis (Unemployment)

Achieving the Three Goals The governments role is to prevent unemployment and prevent inflation at the same time. If the government focuses too much on preventing inflation and slows down the economy we will have unemployment. If the government focuses too much on limiting unemployment and overheats the economy we will have inflation   Unemployment Inflation GDP Growth Good 6% or less 1%-4% 2.5%-5% Worry 6.5%-8% 5%-8% 1%-2% Bad 8.5 % or more 9% or more .5% or less

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Connect this cartoon to the article? Consumer Confidence

The Broken Window Fallacy Stossel Video: The Broken Window Fallacy 7