Economic Indicators

Standard 9: Explain how economic indicators are used in a market economy for business analysis and marketing decisions.  Demonstrate the ability to retrieve and interpret figures from public websites.

 

Opening Assignment

On your own paper answer the following questions: (20 minutes)

1. How would you describe a healthy teenager (physically, habits, etc)? 
2. Which, if any, are personal goals you have made for yourself? (you won't have to share aloud)
3. How do teens actions affect their health?
4. In your opinion, why do so many of us act in ways that are not healthy? 
5. Do you think the economy in the United States today is healthy?
6. How can we measure the health of our nation's economy?  Read pages 70-74 and be prepared to discuss in class.

Class Connection

• Take vitals of volunteer students.  (optional, 7 minutes)
• Today we are actually going to be asking if our economy is healthy.  Much like looking at different factors of your personal health, there are measurements in 5 different areas that we can check to see how are economy is faring. 
• Name a period in U.S. history of which you would not want to be a part.

 Video 1

Objectives:

• List and define the goals of a healthy economy
• Explain how an economy is measured
• Use online data resources to measure U.S. economy health

Goals of a Healthy Economy

1. increased productivity
2. decreased unemployment
3. maintain stable prices

Economic Measurements

 

1.  Labor Productivity

• invest in new equipment for more efficient work
• additional training or financial incentives
• reduce workforce
• specialization and division of labor (ex: assembly line) 

http://www.bls.gov/lpc/ 

 

 

2.  Gross Domestic Product (GDP)

• private investment
• government spending
• personal spending
• net exports of goods and services
• change in business inventories

What government agency is responsible for reporting the U.S. GDP?
Why do you think the United States government switched from using the GNP to the GDP?

U.S. Bureau of Economic Analysis

 

3.  Standard of Living

• GDP/per person (capita) = standard of living  Gallup research
• social services
• durable goods

 

 

4.  Inflation Rate 

• consumer price index (CPI)- cost of living index (food, housing, transportation, medical costs,etc)
• producer price index (PPI) - wholesale price level

1. Inflation refers to rising prices.  Give an example of economic inflation with a product that you purchase?
2. Why and how does the government sometimes try to discourage borrowing money?

Click on the following link to determine the U.S. inflation rate for 2015.
U.S. Inflation Rate

1. Is the most recent year's inflation rate higher or lower than the previous year?
2. Is that good or bad?
3. Is the trend getting better or worse?

 

5.  Unemployment Rate

The lower the unemployment rate , the greater the chances are of economic expansion.
More people working =  more people spending money, paying taxes (less social services)

Click on the following link to determine the most recent unemployment rate.
http://data.bls.gov/timeseries/LNS14000000

1. When was unemployment at its highest level?
2. When was unemployment at it's lowest level?

Partner Activity

Click on this video link from 2012 as it brings up the idea of under-employed workers and how they skew the unemployment rate.  Interesting to think about...

Ask each other the following questions and be prepared to share with the class:

1. Do you know anyone that is currently unemployed and actively looking for a job (no names please)?
2. How long have they been unemployed?
3. How do you think unemployment levels affect tax-payers?

 

Other Economic Indicators and Trends

The Conference Board (private business research organization)

• consumer confidence index
• consumer expectations index
• job index (consumer's perceptions about jobs available)
• consumer polling
• retail sales
• big purchases (housing, trucks, autos)
• wages and new payroll jobs

 

 

Review What You've Learned

So back to the question that I posed in the opening assignment...

• How can we measure the health of our nation's economy?

Answer the following questions on your paper: (5 points each)

1. What are the 3 goals of a healthy economy?
2. What are the 5 key economic measurements?
3. What indicator would you use to determine if employers were hiring more workers?
4. What is inflation and what does it tell us about the strength of our economy?
5. Since 2005 what 3 years had the highest inflation rate (in descending order starting with highest)? 

 

Research Report

• Prepare a one page essay over the topic listed below.  
• Must be typed, DS, 12 pt size font, Times New Roman 
• Due next class period.

Which of the above economic measurements need a specific strategy for improvement for our current U.S. economy and why (cite your reasoning)?

Rubric:  50 points available
10 -Formatting per instructions
10 -Grammar and punctuation
10 -Use of one of the discussed economic measurements (showing understanding of how measurement relates to the health of the economy
10 -Cite U.S. data and source of information in the report and as a footnote
10 - Headings: Title, "Dear Economic Doctor", Labeling of Report (see sample  and checklist)