Today’s Warm Up • How is my life affected by how well the economy is doing? • How do you know how well the economy is doing? • Be ready to share! Where We’re Headed… • From MICROeconomics to MACROeconomics Economic Interdependence Unit Essential Question: How can economic stability be achieved? Today’s LEQ: Why is our economy interdependent? Economic Interdependence • People participate in the economy in a variety of ways – People make decisions as consumers when they purchase g/s – People make decisions as producers when: • They provide human & natural resources to businesses • Their savings allow businesses to borrow to make investments in capital goods – People make decisions as citizens, especially as voters, that influence the economic decisions made collectively in the economy • ECONOLAND SIMULATION ECONO FACTORY Visual 10.1: Circular Flow of Productive Resources, Goods & Services, and Money Payments ECONOLAND Recap: A/B Partners 1. According to the diagram, in which markets do businesses give money-income payments to households in exchange for their productive resources? 2. In which markets do households give money payments to businesses in exchange for goods and services? 3. What did Econos represent in the simulation? Visual 10.2: Government in the Circular Flow A/B Partners 1. Give an example of a productive resource that households sell to government. 2. Give an example of a good or service that businesses sell government 3. Give an example of a good or service that government provides to households in exchange for money payments, mainly taxes. 4. Give an example of a good or service that government provides to businesses in exchange for money payments. Economic Interdependence • The U.S. economy is organized around a system of private markets • Prices for g/s are determined by the interaction of buyers and sellers • This form of economic activity creates a type of interdependence between people in households and people in businesses Circular Flow Collage • Recreate the circular flow diagram on your poster paper by finding examples within newspapers & magazines of the circular flow actions taking place • Include both real flows (a picture of someone getting a haircut or purchasing goods at a store) and money flows (an arrow showing the flow of money) A/B Partners • How do individuals and families in households depend on people in business? • How do businesses depend on individuals and families in households? • What is the role of government in the circular flow of economic activity? Case Study – Jigsaw Activity • Groups of four (two sets of A/B partners) • Each person reads one current event article & determines how one event may affect the economy as a whole • Each person will share and discuss their findings with the rest of the group • After the discussion is complete, your group should complete the provided graphic organizer – In column 1, the headline should be written – In column 2, the group should provide a concise explanation of how this event could impact at least two sectors of the economy – In column 3, the group should provide evidence presented in the article to support their conclusion Today’s Exit Ticket • Provide a formal response to today’s LEQ: Why is our economy interdependent?