We will be using Cornell Note Taking Format Today! Economic
Growth: Economic Growth: Full Speed Ahead!
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Unit Five: Learning Objectives: North Clackamas School District
Social Studies Priority Standards: Econ 50. Explain how economic
indicators (GDP, CPI, Inflation and Unemployment) describe the
condition of the economy.
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Lesson Three: Daily Learning Target I Can define and explain in
writing the following key Economic concepts: The Federal Reserve
Bank (Review) The Business Cycle Recession Depression Expansion How
the Fed makes monetary policy
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The Fed The Federal Reserve Bank is commonly referred to as the
Fed. The Federal Reserve Bank is commonly referred to as the Fed.
The Federal Reserve Bank can make loans to banks, raise or lower
interest rates, and require banks to hold adequate reserves. The
Federal Reserve Bank can make loans to banks, raise or lower
interest rates, and require banks to hold adequate reserves. The
Fed helps banks across America. The Fed helps banks across America.
No Dough Bank
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Destroy/Issue paper notes The Fed clears 40%; The Fed clears
40%; Banks clear rest electronically.
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$97.50 +30% The Fed controls the banks ability to create new
money to ensure the economy doesnt get too much money, nor too
little. Overfed Fed just right 1980 1983 $75.00 Money Prices
Underfed And so it is with money. Not too much, not too
little.
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Level of business activity Expansion GROWTH TREND
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75% of Africans get by on less than $2 a day.
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No Money For Real Capital No Money For Saving No New Dev
elopmen t Poverty Low Per Capita Income
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Real Capital
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Size of employed labor force Quantity of real capital Discovery
of new raw materials Average hours of work Increase in inputs [such
as land, labor and capital] [33%] Technological advance Education
and training Use resources in the least costly way [Productive
efficiency] Allocate resources among production techniques that
produce goods/services that maximize societys well-being. Increase
productivity of these inputs [66%] Real GDP x =
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10 inch image would cost $4,526 in 2013 12 inch image would
cost $6,485 in 2013 20 inch image would cost $23,282 in 2013 12
inch image $695 20 inch image $2,495
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A business cycle is a period of economic expansion followed by
a period of contraction.
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Recessions and Depressions Each phase of the business cycle is
determined by monitoring Gross Domestic Product. A contraction that
lasts for at least six months is called a recession. A particularly
severe and long contraction is called a depression.
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June, 2009 18
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Four Phases of the Business Cycle Level of business
activity
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One Cycle [Real GDP per year] Time [Have averaged 5-6 years]
Expansion
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Think of it as a rollercoaster!
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B u s i n e s s C y c l e s Real GDP 8085 90 90 4600 5200 6000
82
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Expansion
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You look good. You look verrrry good. 1 st date Jealousy sets
in Gets engaged She goes off to college. He uses the meeting line
on unsuspecting freshmen girls You decide to get married Baby-5
months later But with education a job is gained as well as a new
house You become a happy family Happily ever after One loses a
job
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[The leading indicators have predicted 12 of the last 16
recessions] Barometer Of The Future Like taking the blood pressure
of the economy [3-6 months] Where we are heading
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We are afraid we might lose our job & need some of the fish
food money. Little food, little water
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The best way to help yourself in a time of recession We all
know the real path to success & happiness in life is to? Marry
a Kardashian!
