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Short-Run Economic Fluctuations

Students will example the model economists use to analyze the economy’s short-run fluctuations–the model of aggregate demand and aggregate supply. Students will learn about some of the sources for shifts in the aggregate-demand curve and the aggregate-supply curve and how these shifts can cause fluctuations in output. Students will be introduced to actions policymakers might undertake to offset such fluctuations. Students will see why there is a temporary trade-off between inflation and unemployment, and why there is no permanent trade-off.

Assignment Steps

Resources: National Bureau of Economic Research

Select an organization your team is familiar with or an organization where a team member currently works.

Create a 3-slide Microsoft® PowerPoint® presentation to present to the organization’s Executive Committee.

Include the following items:

  • Identify the three key facts about short-run economic fluctuations and how the economy in the short run differs from the economy in the long run.
  • However, I want to stress that the required elements that you are explaining concern concepts in macroeconomics, and are not intended to be related to the specific organization you have chosen and its operations, etc. This means that background on the organization is not necessary or even desirable, and that trying to discuss the required elements in the context of the particular organization’s business will not be useful.

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