Beginning Activities Title today’s lesson: Business Cycles and Fluctuations Notes Activity: Copy the Graph on Page 376; define the terms listed on the graph Mission Statement: To prepare you for a life of responsible citizenship Daily Expectations: – Use bathroom before class – Come in quietly and get to work immediately – Pay attention and be respectful – No phones – No food or drinks other than water – Do your work – Give AP quality effort 5 bonus points for supplies

Extra Credit 5 points each 6 weeks for bringing supplies: – Paper clips – Pens – Paper – Staples – Tape

Business Cycles and Fluctuations Chapter 14 Economic Stability

Causes of the Business Cycle Business decrease investment. Businesses cut back during hard times and increase during good times. Innovation – New products can create a new demand. – More efficient ways of producing goods – Investment follows, creating more economic activity. The Federal Reserve can increase or decrease the money supply. External shocks – Connect to the Present: Crimea and Oil Prices in Europe Connect to the Present: Crimea and Oil Prices in Europe

Predicting Business Cycles Econometric model – macroeconomic model that uses algebraic equations to describe how the economy behaves Index of leading indicators – a monthly statistical series that usually turns down before real GDP turns down, and turns up before real GDP turns up.

Ending Activity Writing Activity: Innovation – What innovation in American history do you think has had the biggest impact on the American economy? – 1 page at least Make sure the floor is clean Connect to our objectives: How does this prepare you for life and the future?