AP ECONOMICS: February 23

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AP ECONOMICS: February 23 Warm-up: Complete then discuss Worksheet 19.1 (HO from earlier) A.P. Economics Learning Target #1 In order to understand how equilibrium national output and price level are determined, I will analyze how AD and AS interact in ways that impact full employment output. I will know I have it when I can show, on an appropriately labeled LRAS-AD-AS graphs, the economy at equilibrium while: (1) at full employment output; (2) experiencing a recessionary gap; and (3) experiencing an inflationary gap. --3 possible economic situations: -full employment; recessionary gap; inflationary gap A.P. Economics Learning Target #2 In order to understand how public policy can impact the economy’s output, price level, and level of unemployment, I will analyze the impact of fiscal policy on AD. I will know I have it when I can: (1) list and explain the fiscal policy tools (taxation, transfer payments, and government spending); and (2) show the impact of fiscal policy in the LRAS-AD-AS Model. --closing the gaps using AD-side fiscal policy -recessionary gap—appropriate fiscal policy? -inflationary gap—appropriate fiscal policy? -begin Act. 5-1 (HO) Assignment: --read Modules 21 and 30