1. MCT #2 & FRQs are Wed., Oct. 12th and Thur., Oct. 13th
AP ECONOMICS: October 13
A.P. Economics Learning Target
In order to understand how equilibrium national output and price level are determined, I will analyze the impact of the multiplier effect. I will know I have it when I can: (1) explain why a change in government spending is more powerful than a change in taxation and transfer payments; and (2) calculate the amount that the govern-ment must change its taxation, transfer payments, or spending to help the economy reach full employment by taking the multiplier effect into account.
Warm-up: The economy has a recessionary gap of $40B. Calculate how much the government would need to spend to close the gap if the MPC is (1) .5; (2) .8; and (3) .75
Multiplier and Spending Practice--YouTube (2 min. 2 sec.)
--why is a change in government spending more powerful than a change in taxation and change in transfer payments?
--Worksheets 21.1 (Tax/Transfer Multiplier) and 21.2 (HO)
Assignment:
--study for multipliers quiz (quiz is Monday)
--work on MC Practice for MCT Exam #2 (HO)
--watch videos at Mr. Clifford’s web site (AC-DC Economics)
MCT #2 & FRQs are Wed., Oct. 12th and Thur., Oct. 13th