About This Chapter
Below is a sample breakdown of the Aggregate Demand and Supply chapter into a 5-day school week. Based on the pace of your course, you may need to adapt the lesson plan to fit your needs.
|Day||Topics||Key Terms and Concepts Covered|
|Monday||Economic models||Classical and Keynesian models and how it affects the economy|
|Tuesday||Aggregate supply and demand; labor supply/demand||Breakdown of the aggregate supply and demand model; reasons for shifts in labor supply and labor demand|
|Wednesday||Marginal propensity; government spending||Meaning and formula of the marginal propensity to consume; how government spending and borrowing affect private investment|
|Thursday||Aggregate supply||Meaning of aggregate supply and its influence on the economy and the equilibrium level of output|
|Friday||Sticky wages and supply shocks||Explanation of sticky wages and comparison of favorable vs. unfavorable supply shocks|
1. The Keynesian Model and the Classical Model of the Economy
Economists use two basic models to describe economic growth. In this lesson, you'll find out more about each one of these models using real-world examples. So buckle up your seatbelts!
2. Supply and Demand Curves in the Classical Model and Keynesian Model
See how economists illustrate aggregate supply and aggregate demand in the long-term and short-term using the Classical and Keynesian models. This lesson emphasizes the differences in the shape of the aggregate supply curve using these two models.
3. Aggregate Supply and Aggregate Demand (AS-AD) Model
Supply and demand models are useful for examining the behavior of one good or market, but what about looking at a whole economy? Luckily, the aggregate supply and aggregate demand model lets us do just that.
4. Understanding Shifts in Labor Supply and Labor Demand
Find out what the labor supply is and what causes it to change or shift. Learn about labor demand and what causes firms and markets to increase or decrease their demand for labor.
5. Marginal Propensity to Consume: Definition and Formula of the MPC
MPC or MPS, what category is higher when you have extra money? In this lesson, learn about the marginal propensity to consume, one of the most important assumptions underlying fiscal and monetary policy.
6. Government Spending, GDP, and Crowding Out Private Investment
When the government spends more than it earns, it has to borrow money, which has repercussions throughout the economy. In this lesson, learn how government spending can crowd out private investment in the market for loanable funds.
7. Aggregate Supply in the Economy: Definition and Determinants
Learn about one of the fundamental components of economics. Find out what aggregate supply is and seven of the most common areas that influence it in today's economy.
8. Aggregate Supply in the Short Run
Learn about aggregate supply in the short run (SRAS) and what that really means. Find out how the overall price of goods affects quantity supplied in the short run and other key determinants that can increase and decrease aggregate supply in this time period.
9. Sticky Wages and Prices: Effect on Equilibrium
With the help of real-world examples, this lesson explains Keynes' important observation that wages and prices often don't adjust quickly to changes in economic conditions
10. Favorable Supply Shocks & Unfavorable Supply Shocks
In this lesson you'll learn the definitions, causes and effects of the two types of supply shocks in the economy by looking at a fictitious economy as an example.
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Other chapters within the Macroeconomics Syllabus Resource & Lesson Plans course
- Scarcity & Production Possibilities Curve Lesson Plans
- Comparative Advantage & Specialization Lesson Plans
- Demand, Supply and Market Equilibrium Lesson Plans
- Measuring the Economy Lesson Plans
- Economic Growth and Productivity Lesson Plans
- Inflation Measurement and Adjustment Lesson Plans
- Understanding Unemployment Lesson Plans
- Macroeconomic Equilibrium Lesson Plans
- Inflation and Unemployment Lesson Plans
- Money, Banking and Financial Markets Lesson Plans
- Central Bank and the Money Supply Lesson Plans
- Fiscal and Monetary Policies Lesson Plans
- Foreign Exchange and the Balance of Payments Lesson Plans
- Inflows, Outflows, and Restrictions Lesson Plans