Lesson Plan Course Title: Principles of Business, Marketing, and Finance Session Title: Discovering Business Cycles Performance Objective: The student differentiates between the types of economic systems with emphasis on the private enterprise system and the United States economy. Specific Objectives: (3)(B) Identify business cycles. Preparation TEKS Correlations: This lesson, as published, correlates to the following TEKS. Any changes/alterations to the activities may result in the elimination of one or more of the TEKS listed. Interdisciplinary Correlations: English: §110.42. English I (c) The student is expected to: (8)(B) read in such varied sources as diaries, journals, textbooks, maps, newspapers, letters, speeches, memoranda, electronic texts, and other media; (6)(A) expand vocabulary through wide reading, listening, and discussing; and, (4)(F) compile written ideas and representations into reports, summaries, or other formats and draw conclusions. Economics: §118.2. Economics (c) The student is expected to: (19)(C) Analyze the impact of business cycles on U.S. history. Instructor/Trainer References: 1. Brown, Betty J. and Clow, John E. (2003). Introduction to Business: Fifth Edition. New York: Glencoe/Mac-Graw Hill. Instructional Aids: 1. Optional – Overhead, SmartBoard, Internet, ELMO (if available and where applicable) Materials Needed: 1. Textbook 2. Internet Copyright © Texas Education Agency, 2011. All rights reserved. 1 Learner Preparation: Learners will review vocabulary terms the night before and read textbook the night before. Lesson Plan Vocabulary (Please see PowerPoint pages 1 – 3. Share with students prior to guided practice): Business Cycle The movement of the economy from good times to bad times and back again in four stages: prosperity, recession, depression, and recovery. The rise and fall of economic activity over time. Prosperity [Peak] The high point of a business cycle, also called the peak, when employment is high, the demand for goods and services is high, and business are turning out goods and services as fast as they can. Recession [Contraction] A stage in the business cycle in which the economy is in a period of decline—spending falls so fewer goods and services are demanded and unemployment rises. Depression [Trough] The lowest point in a business cycle. It is also considered a deep recession. A depression is characterized by high unemployment and low productivity. Recovery [Expansion] A rise in business activity after a recession or depression. Production starts to increase, unemployment decreases, and GDP grows. General Economic Activity Indicators Gross Domestic Product, Unemployment, Inflation, and National Debt Gross Domestic Product (GDP) The total dollar value of all the goods and services produced in a country in a given year. Productivity A measure of how much a country produces. Unemployment Rate Percentage that reflects the number of people who are able to work but do not have a job during a given period of time. Inflation Rate Percentage that reflects a general increase in the cost of goods and services. National Debt The total amount of money a government owes. Budget Deficit When the government spends more on programs than it collects in taxes, or expenses exceed Copyright © Texas Education Agency, 2011. All rights reserved. 2 income. Budget Surplus When the government collects more in taxes than it spends on programs, or income exceeds expenses. Brown, Betty J. and Clow, John E. (2003). Introduction to Business: Fifth Edition. New York: Glencoe/Mac-Graw Hill. Introduction (LSI Quadrant I): Prosperity, recession, depression, and recovery are terms representative of business cycle phases. We often hear these terms, but do we know what they mean? What phase of the business cycle are we experiencing today? What makes the economy move from one phase to another? Who or what are the key players? Today, we will learn the answer to all of these questions as we identify parts of the business cycle. Outline Outline (LSI Quadrant II): Instructors can use the PowerPoint presentation, slides, handouts, and note pages to support and reinforce the following outline. MI Outline Notes to Instructor I. Application – Guided Practice I. Application – Guided Practice A. Complete an activity in which the A. Distribute Discovering Business student labeling the parts of a Cycle (Microsoft Word) business cycle. 1. Complete page 1 B. Match the words peak, trough, 2. Answer key is on page 4 contraction, and expansion to parts 3. Instructor can use of a business cycle. Smartboard, ELMO, or overhead with PowerPoint page 4 during this activity. II. Application – Independent Practice B. Distribute Discovering Business A. Complete a grid that identifies Cycle (Microsoft Word) characteristics of the parts of the See Multiple business cycle using economic 1. Complete page 1 Intelligences indicator descriptions. 2. Answer key is on page 4 (MI) key B. Complete a puzzle that reinforces below. terms taught during class II. Application – Independent Practice A. Distribute Discovering Business Cycle (Microsoft Word) 1. Complete page 2 2. Answer key is on page 4 B. Distribute Discovering Business Cycle (Microsoft Word) 1. Complete page 3 2. Answer key is on page 4 Copyright © Texas Education Agency, 2011. All rights reserved. 3 Summary I. Summary Review Questions A. Answer questions from the Quiz Show. I. Summary Review Questions A. Display review questions saved in the Quiz Show section of the PowerPoint, pages 5 - 11. (View in Slide Show mode.) Evaluation I. Evaluation A. Students individually research this country’s economic indicators and relate them to the business cycle. Extension/Enrichment I. Extension/Enrichment A. Students explore other website activities based on similar content. B. Students research the beginning of the last recession. I. Evaluation A. Utilize the Economic Indicator Analysis Microsoft Word document to complete this activity. B. Teacher can divide students into small groups. C. Teacher can assign students to different periods or sets of months, i.e., separate by presidential terms, historical eras, or years. D. Students can expand research beyond cited websites. I. Extension/Enrichment A. Allow students to explore other websites activities based on similar content such as: http://www.frbsf.org/education/activities/chairman/ind ex.html B. Engage the students in a research project in which they determine the beginning month/year of the last US recession. 1. Students determine resources needed to substantiate response. Copy and paste Multiple Intelligences Graphic in appropriate place in left column. Verbal Linguistic Logical Mathematical Visual Spatial Musical Rhythmic Bodily Kinesthetic IntraPersonal Copyright © Texas Education Agency, 2011. All rights reserved. 4 Interpersonal Naturalist Existentialist Application Guided Practice (LSI Quadrant III): Distribute Microsoft Word document entitled: Discovering Business Cycles, page 1 (the answers can be found on Discovering Business Cycles – Answer Sheet on page 4). Independent Practice (LSI Quadrant III): Distribute Microsoft Word document entitled: Discovering Business Cycles, pages 2 and 3 (the answers can be found on Discovering Business Cycles – Answer Sheet on page 4). Summary Review (LSI Quadrants I and IV): • • Question: List the four business cycle phases. Answer: Prosperity, recession, depression, and recovery. • • Question: What is a characteristic of Recovery? Answer: Decreased prices (deflation) • • Question: Describe and list the general economic activity indicators? Answer: They are major influencers (measures) of a country’s economic performance - GDP, National Debt, Inflation, Unemployment. • • Question: Changes in GNP influences the business cycle. True or False? Answer: True • • Question: Which part of the business cycle is also referred to as the trough? Answer: Depression Evaluation Informal Assessment (LSI Quadrant III): Evaluate answers to independent practice.  Address issues raised in independent practice. Formal Assessment (LSI Quadrant III, IV): Economic Indicator Analysis  A grading rubric is attached (Business Cycle Assessment Rubric).  Rubric can be modified or replaced using http://rubistar.4teachers.org/ Copyright © Texas Education Agency, 2011. All rights reserved. 5    Students can be placed in collaborative groups to complete project. Teacher can assign students to different periods or sets of months, i.e., separate by presidential terms, historical eras, or years. Students can expand research beyond cited websites. Extension/Enrichment (LSI Quadrant IV):  Allow students to explore other websites activities based on similar content such as: http://www.frbsf.org/education/activities/chairman/index.html  Engage the students in a research project in which they determine the beginning month/year of the last U.S. recession. Useful websites: http://www.crosswordpuzzlegames.com/cgi-crosswordpuzzlegames/create http://www.councilforeconed.org/resources/lessons/ap_resources/AP-Macroeconomics-Visual-2-7.pdf http://www.bls.gov/eag/ http://www.eduref.org/Virtual/Lessons/Social_Studies/Economics/ECO0006.html http://www.econedlink.org/lessons/index.php?lesson=EM131 http://www.nber.org/ Copyright © Texas Education Agency, 2011. All rights reserved. 6 ECONOMIC INDICATOR ANALYSIS Instructions: Complete the table using data about US economic indicators. Access the US Department of Labor’s website for the Bureau of Labor Statistics, http://www.bls.gov/; the US Department of Treasury’s website for the Bureau of the Public Debt, http://www.treas.gov/; and, US Department of Commerce’s website for the Bureau of Economic Analysis, http://www.bea.gov/index.htm. Replace the periods with consecutive months or quarters, i.e., May 2009 (Period 1) through September 2009 (Period 5). Prepare graphs displaying the various economic indicator trend data researched. Use the graphs to determine the phase of the business cycle. Present graphs and business cycle results to class. Indicator Period 1 Period 2 Period 3 Period 4 Unemployment Rate Inflation Rate Productivity National Debt (Public Debt) Gross Domestic Product Other Copyright © Texas Education Agency, 2011. All rights reserved. 7 Period 5 DISCOVERING BUSINESS CYCLES Instructions: Label the parts of the business cycle using the following terms: Prosperity, Depression, Recovery, and Recession. Match: Draw a line to match parts of the business cycle with terms that describe them. Prosperity Contraction Depression Trough Recovery Peak Recession Expansion Instructions: Show your understanding of the economic indicators by using the following terms to describe how unemployment and productivity affect the business cycle: Increases Decreases High Low Recover y Prosperit y Recessio n Unemploymen t Productivity Copyright © Texas Education Agency, 2011. All rights reserved. 8 Depressio n DISCOVERING BUSINESS CYCLES Instructions: Show your understanding of the economic indicators by using the following terms 1 2 3 4 5 6 7 8 9 ACROSS DOWN 1. Lowest point in the business cycle 3. Prosperity, recession, depression, and recovery 4. Contraction 6. Reflects the general increase in the cost of goods and services 7. A general decrease in the costs of goods and services 8. A rise in business activity after a recession or depression 9. When the government spends more on programs than it collects in taxes or expenses exceed income 2. Characterized by low unemployment and high productivity 5. The total amount of money the government owes Copyright © Texas Education Agency, 2011. All rights reserved. 9 DISCOVERING BUSINESS CYCLES Answer Key Page 1 Business Cycle – See Business Cycle Model in textbook Matching Prosperity – Peak Depression – Trough Recovery – Expansion Recession – Contraction Page 2 Recovery Unemployment Decreases Productivity Increases Prosperity Low High Page 3 Across 1. Depression Recession Increases Decreases 8. Recovery 3. Business Cycle 9. Budget Deficit 4. Recession Down 2. Prosperity 6. Inflation 5. National Debt 7. Deflation Copyright © Texas Education Agency, 2011. All rights reserved. 10 Depression High Low Graphing : BUSINESS CYCLES Student Name: CATEGORY Title Labeling of X axis Labeling of Y axis ________________________________________ 10 Title is creative and clearly relates to the problem being graphed (includes dependent and independent variable). It is printed at the top of the graph. The X axis has a clear, neat label that describes the units used for the independent variable (e.g, days, months, participants' names). 9 8 Title clearly relates to A title is present at the problem being the top of the graph. graphed (includes dependent and independent variable) and is printed at the top of the graph. 7 SCORE A title is not present. The Y axis has a clear, neat label that describes the units and the dependent variable (e.g, % of dogfood eaten; degree of satisfaction). The Y axis has a clear The Y axis has a label. The Y axis is not label that describes labeled. the units and the dependent variable (e.g, % of dogfood eaten; degree of satisfaction). The X axis has a clear The X axis has a label. The X axis is not label that describes labeled. the units used for the independent variable. Copyright © Texas Education Agency, 2011. All rights reserved. Type of Graph Chosen Graph fits the data Graph is adequate well and makes it easy and does not distort to interpret. the data, but interpretation of the data is somewhat difficult. Neatness and Exceptionally well Neat and relatively Attractiveness designed, neat, and attractive. A ruler and attractive. Colors that graph paper (or go well together are graphing computer used to make the program) are used to graph more readable. make the graph more Preparedness Student is completely Student seems pretty prepared and has prepared but might obviously rehearsed. have needed a couple more rehearsals. Graph distorts the data somewhat and interpretation of the data is somewhat difficult. Graph seriously distorts the data making interpretation almost impossible. Lines are neatly drawn but the graph appears quite plain. Appears messy and "thrown together" in a hurry. Lines are visibly crooked. Content Shows a good understanding of parts of the topic. Often listens to, shares with, and supports the efforts of others in the group but sometimes is not a good team member. Collaboration with Peers Timeliness Shows a full understanding of the topic. Almost always listens to, shares with, and supports the efforts of others in the group. Tries to keep people working well together. Shows a good understanding of the topic. Usually listens to, shares with, and supports the efforts of others in the group. Does not cause "waves" in the group. The student is Student does not somewhat prepared, seem at all prepared but it is clear that to present. rehearsal was lacking. Does not seem to understand the topic very well. Rarely listens to, shares with, and supports the efforts of others in the group. Often is not a good team member. All graphs were A majority of the One-half of the graphs Atleast one graph was completed in a timely graphs were were completed in a completed in a timely manner. completed in a timely timely manner. manner. manner. Business Cycle Trended data from Trended data from Trended data from Trended data from graphs greatly graphs somewhat graphs did not graphs are incomplete supports business supports business support business cycle and no business cycle cycle and cycle and and presentation was declared. (1) Deduct points for formating, neatness and attractiveness. (2) Modify or create a new rubric by going to http://rubistar.4teachers.org/ Copyright © Texas Education Agency, 2011. All rights reserved. TOTAL Copyright © Texas Education Agency, 2011. All rights reserved.