Monday, January 5, 2015

Ch. 9 Reading Guide

1.  Define consumption schedule.
2.  Define savings schedule.
3.  What do the average and marginal propensity to consume tell an economist?  What are the formulas for the APC and APS?
4.  What do the marginal propensities to consume and save tell an economist?  What are the formulas for MPC and MPS?
5.  Identify how an increase in each of the following would impact C and S: (you should remember this from AS/AD).
a.  wealth
b. price expectations
c  real interest rates
d.  household debt
e. taxation*

Tuesday, December 16, 2014

Everyone learned about the ruthless "robber barons" in US history.  Perhaps you have even read the article linked below (it is one of my favorites).  This time we are going to explore it from an economic perspective.  Please print out a copy of the article and bring it to class on Friday complete with your notes and underlining.  This promises to be a good discussion.

To consider when reading and responding to the post:

1.  What is the traditional view of 19th century industrialists?  Where did this view come from and to what extend is it inaccurate or inaccurate?
2.  What view does Klein attempt to put forth as a challenge to this view?  What evidence is used?
3.  Think back to your own history education?  How was the topic of industrialization treated?
4.  Pick one or two of the individuals profiled in the article and detail the alternative view of their contributions.
5.  Think about the current popular view of large banks, corporations, and billionaires in our society.  Is our current disdain for these groups any different than the popular caricature of robber barons?

Good luck.  I really like this article, so read carefully.

Fed. Challenge Application (You Know You Want To!)

Answer and submit to the blog before we leave for the holiday break if you would like to be considered.  I WILL NOT be posting responses.  It is just for me to read.  Remember that I can only select 5 students!

1.  Why do you want to be part of our Fed. Challenge team?
2.  What is one aspect of our economics class that you have enjoyed and found valuable so far this year?
3.  What particular strengths do you think you would bring to our team?
4.  Are there any days after school where you would not be available to meet?
5.  Are you available for all possible competition days including 1/28, 3/12, 3/17 and 4/16?
6.  How many days have you been absent from school this year?
7.  Anything else I should know or consider?

Wednesday, December 3, 2014

The State of the American Retirement

Isn't it just like a teacher to give you an assignment about retirement before you have even started working?  I understand this subject may seem remote to you at age 17, but retirement system in America is a major component of our economy as well as a component of our social contract.  And that contract HAS changed over the past decades.  While Social Security still exists to replace some worker income in retirement, the corporate pensions plan one thought of a standard perk for a long and dedicated career, has gone the way of the dodo.  Read the three links below.  The first is an introduction to the situation that describes the contrast between defined benefit (pension) and defined contribution ( 401k) plans that currently make up the bulk of most America's retirement funds.  The other two links are to articles arguing, in on case, for pensions and for 401ks in the other.

You blog post should respond to some of these issues:

1.  What is the difference between pensions and 401k's?
2.  Where did the 401k model come from?
3.  When did the shift from pension to 401k occur and why?
4.  Are Americans  better off with a 401k of pension?  explain.
5.  Are most American's prepared for retirement?  Explain.
6.  What should young workers be doing to prepare for retirement?  And when?
7.  Do you think the current retirement scheme will provide security for you, your parents? 
8.  What do you think we should have in place as a retirement system?
9.  Compare to other countries?


Tuesday, December 2, 2014

Ch. 11 Reading Guide

Due Wed. 12/3

1.  Illustrate the aggregate demand (AD) curve. How does each of the following explain the downward slope of the AD curve?
a.  Real-Balances Effect (wealth effect)
b.  Interest-Rate Effect
b.  Foreign Purchases Effect (net export effect)

2.  Create a chart to organize each factor affecting aggregate demand.  Columns should include:  definition of the factor, illustration of increase, illustration of decrease.

Due Mon.12/8

1.  Illustrate the Long Run Aggregate Supply (LRAS) curve.
2.  Why is the LRAS curve vertical?
3.  Explain the significance of long run equilibrium (where LRAS and AD meet).
4.  Create a chart identical to #2 from Wednesday's assignment for the factors affecting LRAS.

Due Tues. 12/9
1.  Illustrate the Short Run Aggregate Supply (SRAS) curve.
2.  Explain the slope of the SRAS curve.
3.  Explain the significance of short run equilibrium (where SRAS and AD meet)
4.  Create a chart identical to #2 from Wednesday's assignment for the factors affecting SRAS.

Friday, November 21, 2014

Review Sheet: Economic Indicators Monday Exam 11/24

Review Sheet:  Economic Indicators


  1. Define Gross Domestic Product.
  2. Identify each component of GDP by the expenditure method.  Provide an example of each.
  3. Provide an example of:  intermediate good, non-market transaction, non-productive transaction, secondhand sale, and underground economy.  Why are these excluded from GDP?
  4. How is a recession defined in terms of GDP?
  5. What is unplanned investment?  How is it a factor in GDP?
  6. How are net exports calculated?  What does it mean if the net exports component is a negative number?
  7. What is GDP per capita? 
  8. Explain the difference between nominal GDP and Real GDP.
  9. How is real GDP calculated using base/current year prices and quantities?
  10. What is the GDP Deflator?  How is it used in real GDP calculations?
  11. What are the critical flaws of GDP as an economic indicator?  In other words, what does it do poorly?
  12. Contrast Gross National Product (GNP) with Gross Domestic Product (GDP).


  1.  Define:  full employment, unemployed, labor force
  2. Identify each type of unemployment and provide an example.
  3. Which type of unemployment is most serious to economists?  Least serious?
  4. Which two type of unemployment are present at full employment?
  5. Describe the impact of each on the calculation of the unemployment rate:  Discouraged workers, students, the underemployed, part-time workers.
  6. Explain Okun’s Law.


  1. Define inflation.  Explain cost push and demand pull inflation.  Graph them.
  2. Identify the groups helped/hurt by inflation.
  3. What is the CPI?  How does it measure inflation?
  4. What are market baskets?  Why are the market baskets weighted in the CPI?
  5. How does the CPI differ from the GDP Deflator?  How are the two are indicators similar?
  6. Explain the flaws imbedded in the CPI.
  7. What is the difference between Core CPI and standard (headline) CPI?

Tuesday, November 18, 2014

Reading Guide: ch. 8/ Inflation

1.  Define inflation
2.  Identify and explain the two types of inflation.
3.  Create chart identifying the people and groups helped by inflation and hurt by inflation.
4.  The Federal Reserve has set an inflation "target" of 2%/year indicating that they believe modest inflation is desirable.  Why not aim for 0% inflation?