Transcript Document

Connecting Economics and
Government
1
Paul Solman Video:
Steering the Course
Re-explain the analogy between Homer's
Odyssey and our economic goals
Charybdis
(Unemployment)
Scylla
(Inflation)
Achieving the Three Goals
The governments role is to prevent unemployment and
prevent inflation at the same time.
•If the government focuses too much on preventing
inflation and slows down the economy we will have
unemployment.
•If the government focuses too much on limiting
unemployment and overheats the economy we will have
inflation
Unemployment
Inflation
GDP Growth
Good
6% or less
1%-4%
2.5%-5%
Worry
6.5%-8%
5%-8%
1%-2%
Bad
8.5 % or more
9% or more
.5% or less
Connect this cartoon to the article?
5
Connect this cartoon to the article?
Consumer Confidence
6
Stossel Video:
The Broken Window Fallacy
7