AP Economics
Unit 5: Macroeconomic Indicators
SSEMA1 The student will illustrate the means by which economic activity is measured.
a. Explain that overall levels of income, employment, and prices are determined by the spending
and production decisions of households, businesses, government, and net exports.
b. Define Gross Domestic Product (GDP), economic growth, unemployment, Consumer Price Index
(CPI), inflation, stagflation, and aggregate supply and aggregate demand.
c. Explain how economic growth, inflation, and unemployment are calculated.
d. Identify structural, cyclical, and frictional unemployment.
e. Define the stages of the business cycle; include peak, contraction, trough, recovery, expansion as
well as recession and depression.
SSEPF3 The student will explain how changes in monetary and fiscal policy can have an impact on
an individual’s spending and saving choices.
a. Give examples of who benefits and who loses from inflation.
Day 1:
EQ: What are the goals of macroeconomics?
1. Warm Up: Students will use Today’s Meet to reflect on article (econlib.org – Metaphors)
2. Discuss the difference between macro and micro economics.
3. Where does macroeconomics come from? Show Commanding Heights video clip of Keynes.
Why did Keynes begin the study of macroeconomics?
4. What is the purpose of macroeconomics?
5. Give students list of macro goals. (Economic Growth, Full Employment, Price Stability) Have
students jot down ideas of meaning. Share and discuss.
6. How do we know we are meeting these goals? Discuss.
7. Current Event – Is this economy meeting its macro goals? Discuss.
8. Closing: Socrative Exit Ticket
Focus Question: What is GDP?
1. Warm Up: Using Socrative, students will look at headlines to decide which economic goal is
being (or not being) reached. Data from warm up will be used to pull aside students who missed
two or more and review concepts with them during a practice activity.
2. Tell students we will focus on Gross Domestic Product – the macroeconomic indicator that we
use to measure economic growth.
3. Give students definition of GDP. Break down components of definition. Allow students to start
it in pairs, then after they finish, go over as a group.
4. What can GDP tell us? Show map to explain overall size of US GDP relative to the rest of the
world.
5. What does GDP NOT include? Go over list as a whole class.
6. Student Practice: AP Resource – Included or Excluded in GDP?
7. Closing: Socrative Exit Ticket / Teacher Question: Name two things that would not be included
in GDP.
Homework: 2007 FRQ
Day 3:
Focus Question: How is GDP calculated?
1.
2.
3.
4.
5.
6.
Warm Up: Socrative True/False questions on what is included in GDP
Review- how do we use GDP? Focus on comparing from one year to another.
Practice calculating percent change in GDP.
How do economists determine GDP? Go over Income and Expenditure approach.
Practice categorizing in expenditure approach.
Lesson Recap and Socrative exit ticket. Teacher Question: Why are the expenditure approach
and income approach equivalent?
Day 4:
Focus Question: What is the difference between nominal and real GDP?
1. Warm Up: Give students a data set. What is the problem with our method of calculating GDP?
2. Notes on nominal v. real GDP. Show students the importance of converting to real GDP.
3. Practice GDP problems – Students will work in groups to complete problems where they must
determine the GDP of a country using data (applying expenditure approach) and they must
figure percent change in economic growth using real and nominal data.
4. Closing: Review problems
Day 5:
Focus Question: How can we use the circular flow of income to better understand GDP?
1. Warm Up: Practice on converting from nominal to real GDP. Use to verify student
understanding.
2. Notes on the Circular Flow of Income
a. What groups are included?
b. Examine diagram
c. Leakages/Injections
3. Macronia Problem – Students work in small groups to practice applying the GDP expenditure
formula to the circular flow of income. Go over problem as a class.
4. What is Per Capita GDP?
a. Definition
b. How is it used?
c. Why does it matter?
d. What are its shortcomings?
e. Examine maps/photos to see correlations between per capita GDP and other important
quality of life factors
5. Socrative Exit Ticket
Day 6:
Focus Question: What is a business cycle and how does it relate to GDP?
1. Warm Up: Socrative question on per capita GDP.
2. Introduce the term “business cycle”. Ask students, what is a cycle? Discuss.
3. Explain to students that when we map out changes in GDP, we get a model known as the
business cycle.
4. Go through and discuss the components of the business cycle.
5. Activity – Part1: Examine GDP data. Determine phases of the business cycle. Part II: Given the
conditions described, which phase of the business cycle would the economy be experiencing?
6. Closing: Recap and Socrative Exit Ticket: Teacher Question: List the phases of the business
cycle in order, beginning with a contraction.
Day 7:
Focus Question: What have we learned about GDP?
1. Warm Up: On Today’s Meet, students make a list of the top five things they think are important
about GDP.
2. Discuss warm up list / Review
3. GDP/Business Cycle Quiz
4. Closing: Go over quiz.
Day 8:
Focus Question: How is the unemployment rate calculated and what does it reflect?
1. Warm Up: Socrative – Unemployment Pre-lesson questions.
2. Introductory notes on the following:
a. Unemployment Rate/ Labor Force Participation Rate
b. Three Types of Unemployment
c. Natural Rate of Unemployment and Full Employment
d. Okun’s Law
e. Problems with the Unemployment Rate
3. Closing: Students answer same Socrative questions to see if there was an improvement.
Day 9:
Focus Question: How is the unemployment rate calculated and what does it reflect?
1. Warm Up: Socrative questions used to refocus students on yesterday’s content.
2. Based on closing from previous day, place students into mixed groups with stronger and weaker
students mixed in.
3. Provide students with a set of practice AP questions. Students work on them in groups and coteach one another. Students will check their answers after each one to verify accuracy and
understanding. Teacher will circulate to assist students.
4. Closing: Which numbers were most difficult? Discuss problems.
HW: Nearpod Multiple Choice Questions
Day 10:
Focus Question: How is the unemployment rate calculated and what does it reflect?
1. Warm Up: Unemployment Review
2. Unemployment Quiz (Quiz data will be used to see if additional remediation opportunity is
needed.)
3. After the quiz, students will complete a tiered GDP activity. Some students will correct quizzes
and create sample questions that reflect problems they have looked at. Some will do an
extension assignment: The Lion, The Dragon, and the Future.
Day 11:
Focus Question: What is inflation and what causes it?
1. Warm Up: Socrative Pre-Quiz
2. Introduction to Inflation Notes punctuated with discussion and practice
a. What is inflation?
b. How does inflation affect purchasing power
c. What causes inflation?
d. How does inflation influence interest rates?
3. Closing: Repeat Socrative questions
Day 12:
Focus: How do economists determine the rate of inflation?
1. Warm Up: Socrative pre-assessment
2. Introduction notes to calculating inflation:
a. CPI
b. GDP Deflator
c. Practice
3. Closing: Socrative post-assessment
Day 13:
Focus: How do economists measure the rate of inflation?
1. Warm Up: Socrative questions to refocus on previous content.
2. Place students in mixed ability groups based on data collected from Socrative quizzes on past
two days.
3. Students are given AP-level problems to apply their understanding of inflation. Students will
check answers as they go along to verify understanding.
4. Closing: Focus on questions students had the most trouble with and discuss.
Day 14:
Focus: How do economists measure the overall economy?
1. Warm Up: Students create a chart of information on GDP, Unemployment and Inflation.
GDP
Which goal?
Primary tools for
measurement
Formulas you need to
know
Shortcomings of
measurement
Unemployment Rate
Inflation Rate
2. AP Inflation FRQ that blends in some components of GDP and unemployment. Individual
assignment submitted via Edmodo.
3. Closing: Discuss key components of FRQ to clarify student questions.
Day 15:
Focus Question: How can inflation help some and harm others?
1. Warm Up: Socrative pre-assessment: How are these people affected by inflation?
2. Royalty for a Day Gameshow
a. Students will be assigned individual roles to read. Each character will explain how
he/she is affected by inflation.
b. Class will listen and rate each character as helped/hurt by inflation.
c. Class will vote on character who is hurt “worst” from inflation.
3. Use gameshow to generalize who is helped/hurt from inflation.
4. Closing: Socrative post-assessment.
Day 16:
Focus Question: How can inflation help some and harm others?
1. Warm Up: Make a t-chart showing situations where people might be helped or harmed by
inflation. Be ready to explain.
2. AP Practice Activity – Working in mixed ability groups based on previous assessment, students
work on helped/hurt scenarios. Students will verify answers as they progress.
3. Fist to Five on Helped/Hurt from inflation.
4. Closing: Tell students that we will review for our test on the next day. To better focus on what
the students actually feel they need to review, ask students to respond on Socrative regarding
the material they are most unsure about. Use the material to guide practice.
Day 17:
Focus Question: How and why do we measure and evaluate economic activity?
1. Warm Up: Create a Socrative warm up set of questions that reviews key components that
students had the most questions about from previous day’s closing.
2. Review material based on student responses.
3. Closing: Review test format and key strategies for FRQs.
Day 18:
FRQ Test
Day 19:
Multiple Choice Test
Day 20:
Corrections