Georgia Council on Economic Education w w w. g c e e. o r g Macroeconomics and the Georgia Performance Standards Mike Raymer Program Manager

The Mission To help teachers teach those students, K-12, in the public and independent schools of Georgia

The Vision Productive Workers Informed Consumers Involved Citizens Prudent Savers Wise Investors Sound lifelong decision makers in a globally interdependent world Students leaving school prepared for their roles as:

EOCT Pass Rates

Economics Test Data Trend

Domain Performance for the EOCT Domain WeightNumber of Items Avg. Correct Fall Spring % Correct Fall Spring Fundamental 2 weeks 20.5% %59% Micro 4 weeks 22% %58% Macro 5 weeks 20.5% %55% International 2 weeks 18% %59% Personal Finance 2 weeks 19% %64% Handout

GPS Performance standards provide clear expectations for instruction, assessment, and student work. They define the level of work that demonstrates achievement of the standards, enabling a teacher to know “how good is good enough.” ( Handout

Domain Focus SSEMA1 The student will illustrate the means by which economic activity is measured.

Domain Focus SSEMA2 The student will explain the role and functions of the Federal Reserve System.

Domain Focus SSEMA3 The student will explain how the government uses fiscal policy to promote price stability, full employment, and economic growth.

Macro Pacing Option #1: Five weeks of fury Option #2: Three weeks of indicators, two weeks fiscal/monetary Option #3: Three weeks of indicators, one week fiscal, one week monetary

The Macro “Must Haves”

Circular Flow Model

Business Cycle GDP

Expenditure Approach GDP=C+I+G+(X-M)

Aggregate Demand

Aggregate Supply

Types of Unemployment 1.Structural 2.Cyclical 3.Frictional

Questions?

Where to Begin? Liberal Moderate Conservative Georgia Council on Economic Education w w w. g c e e. o r g

Georgia Council on Economic Education w w w. g c e e. o r g Where to Begin? UnemploymentThe Federal Reserve GDPGovernment Spending InflationTaxation RecessionFederal Debt DepressionFederal Deficit

Gross Domestic Product Gross= total Domestic= produced anywhere in the 50 states, by anyone Product= final goods and services

What does GDP measure? Total amount of final goods and services produced in a country in one year. (Measure of Output)

Are there any cool formulas you can give us relating to this interesting concept? GDP=C+I+G+(X-M)

C = consumption spending (think consumers) 72% I = investment spending (think businesses investing in themselves) 15% G = government spending 17% (X-M) = difference between exports and imports -4%

What is counted in GDP? FINAL goods and services Goods/Services produced here, even if by a foreign co.

What is NOT counted? Things produced outside the country. Illegal stuff Purely financial transactions

…and INTERMEDIATE GOODS

Problems associated with GDP Slow to calculate Does not count everything (it’s an estimate) Inflation can distort the figure Real vs. Nominal

Per Capita GDP GDP divided by a country’s population

GDP practice (all about GDP)

Demonstration Lesson #1 Aggregate Demand and Aggregate Supply Lesson

AD/AS

Questions?

“Bag of Mystery” Inflation

Teaching Tools for MACROECONOMICS from John Stossel

15 Video Clips Instructor ’ s Manual Segment Description Preview Question Discussion and Analysis Questions Extension Activities Multiple-Choice Questions What You Get…

Clip 2- Nominal Values vs. Real Values SSEMA2b

Demonstration Lesson #2 Money and Inflation

Inflation Calculator

Commanding Heights Georgia Council on Economic Education w w w. g c e e. o r g

Questions?

Am I Unemployed?

1. Structural 2. Cyclical 3. Frictional Unemployment

Structural Unemployment

Cyclical Unemployment

Frictional Unemployment

Demonstration Lesson #3 Unemployment

Questions?

Debt v. Deficit

What is the national debt? What caused the national debt? Where does the government get the money when it wants to spend more than it takes in? What is a budget deficit? What is a budget surplus? Questions for You

Demonstration Lesson #4 Should we worry about the national debt?

Georgia Council on Economic Education w w w. g c e e. o r g 1.Will the national debt cause the US to go bankrupt? 2.Are the interest payments on the debt important? 3.What about paying off the debt by increasing taxes? 4.Does running deficits today, and adding to the national debt, put a burden on future generations?

Clip 12- Is Govt. Too Big? SSEMA3b

Fiscal Policy

Actions taken by the Federal Government to influence the economy (business cycles).

How do they do it? Taxation (revenue) Spending (expenditures) -transfer payments-

How/When/Why If the economy needs a “boost” the Federal Government might: _______________ taxes. _______________ spending.

How/When/Why If the economy needs to be “cooled off” the Federal Government might: _______________ taxes. _______________ spending.

Demonstration Lesson #5 How Can Changes in the Federal Government’s Budget Stabilize the economy?

Questions?

Monetary Policy

The actions the Federal Reserve (Central Bank) takes to influence the level of GDP and the rate of inflation in the economy.

Monetary Policy DVD

Tools of the Fed: 1. Open Market Operations 2. Discount Rate (Fed to banks) 3. Federal Funds Rate (bank to bank) 4. Reserve Requirements How Do They Do It?

Open Market Operations Simulation

How/When/Why If the economy needs a “boost” the Federal Reserve might: _______________ bonds. _______________ interest rates. _______________ reserve requirements.

How/When/Why If the economy needs to be “cooled off” the Federal Reserve might: _______________ bonds. _______________ interest rates. _______________ reserve requirements.

Questions?

Demonstration Lesson #6 The Monetary Policy Game

Lesson Ideas for the GPS Handout

Georgia Council on Economic Education w w w. g c e e. o r g

Georgia Council on Economic Education w w w. g c e e. o r g

Workshop: Macroeconomics Workshop Leader: Mike Raymer

Georgia Council on Economic Education w w w. g c e e. o r g