A Tale of Two Countries: Teacher Guide



A Tale of Two CountriesBusiness Management & Administration ProjectProject DescriptionThis project focuses on economic indicators and their use as measures of an economy’s strength. After conducting research on two different assigned countries’ economies, student teams analyze their findings, identify trends in each country’s economic indicators, and make predictions about the different economies. Then, each team determines the strength of the economies and identifies the country that would be most suitable for a local business owner who wants to expand her/his business operations. Each team develops charts and tables that contain its research findings, writes a short report of its recommendation, and gives an oral presentation for the local business owner in which the team explains its recommendation. Students also work individually to gather and analyze news articles about each assigned country.Performance IndicatorsExplain the types of economic systems (EC:007, LAP-EC-017) (CS)Define the following terms: economic system, traditional economic system, command economic system, communism, socialism, and market economic system.Explain why economic systems are needed.Describe the characteristics of traditional economic systems.Describe the characteristics of communism.Describe the characteristics of socialism.Describe the characteristics of a market economic system.Explain how each type of economic system addresses the three economic questions.Describe the strengths and weaknesses of traditional economies.Describe the strengths and weaknesses of communist command economies.Describe the strengths and weaknesses of socialist command economies.Describe the strengths and weaknesses of market economies.Discuss the measure of consumer spending as an economic indicator (EC:081) (SP)Define the term Consumer Confidence Index (CCI). [The Conference Board defines the Consumer Confidence Survey as “a monthly report detailing consumer attitudes and buying intentions, with data available by age, income and region.”]Describe how consumer spending reacts to shifts in the well-being of the economy.Explain how the Consumer Confidence Index functions.Describe how businesses use and react to changes in the Consumer Confidence Index.Discuss government's options when the Consumer Confidence Index indicates a decreasing trend (e.g., issuing a tax rebate or taking other action to stimulate the economy).Describe the economic impact of inflation on business (EC:083, LAP-EC-028) (SP)Define the following terms: inflation, inflation rate, deflation, Consumer Price Index, standard of living, targeted inflation rate, and price stability.Describe causes of inflation.Explain how inflation impacts the economy.Describe the relationship between price stability and inflation.Explain problems associated with deflation.Discuss reasons why the inflation rate should be above zero.Explain how businesses can use the Consumer Price Index.Discuss the purpose of the Consumer Price Index (CPI).Describe how the Consumer Price Index is determined.Identify the major kinds of consumer spending that make up the Consumer Price Index.Explain how the Consumer Price Index is used to find the rate of inflation.Describe limitations on the use of the Consumer Price Index.Explain the concept of Gross Domestic Product (GDP) (EC:017, LAP-EC-001) (SP)Define the following terms: gross domestic product (GDP), personal consumption expenditures, gross private domestic investment, government purchases of goods and services, net exports of goods and services, trade deficit, trade surplus, uncounted production, underground economy, and double counting.Identify the categories of goods and services that make up GDP.Describe problems encountered in calculating GDP.Explain the importance of a country's GDP.Describe ways to increase GDP.Describe how the government responds to changes in GDP.Describe ways that businesses respond to changes in GDP.Discuss the impact of a nation's unemployment rates (EC:082, LAP-EC-029) (SP)Define the following terms: unemployment rate, frictional unemployment, structural unemployment, cyclical unemployment, seasonal unemployment, technological unemployment, and full employment.Discuss individual costs of unemployment.Describe economic benefits of unemployment.Explain theories of the causes of unemployment.Explain why the unemployment rate understates employment conditions.Describe the costs of unemployment for a nation.Driving QuestionWhat growing economy is most promising for expanded business operations?Timeframe3 weeksEntry EventArrange for a successful local business owner (or senior executive) to participate in this project's entry event. To kick off the project, this business owner should introduce himself/herself and talk to the class about his/her business: its products, history, production methods, etc. Then, the business owner should explain to students that s/he would like to expand operations to another country sometime in the next five years and needs the class’s assistance in identifying some viable options. The business owner should explain that s/he is looking for a country with a growing economy (although it doesn’t necessarily have to be a “big” economy). S/He should also explain that s/he wants students to look at past, present, and future predictions of consumer spending, inflation, Gross Domestic Product, and unemployment rates in several different nations to find at least one country that looks like a promising location for his/her new business facilities. Finally, the business owner should tell students that s/he will be back in the classroom at the end of the project to hear the students’ recommendations.Project TitleA Tale of Two CountriesDriving QuestionWhat growing economy is most promising for expanded business operations?Project DescriptionThis project focuses on economic indicators and their use as measures of an economy’s strength. After conducting research on two different assigned countries’ economies, student teams analyze their findings, identify trends in each country’s economic indicators, and make predictions about the different economies. Then, each team determines the strength of the economies and identifies the country that would be most suitable for a local business owner who wants to expand her/his business operations. Each team develops charts and tables that contain its research findings, writes a short report of its recommendation, and gives an oral presentation for the local business owner in which the team explains its recommendation. Students also work individually to gather and analyze news articles about each assigned country.Timeframe3 weeksObjectives of the Project(what you will learn to do)Explain the types of economic systems Discuss the measure of consumer spending as an economic indicator Describe the economic impact of inflation on business Explain the concept of Gross Domestic Product (GDP) Discuss the impact of a nation's unemployment ratesKey DeliverablesBinder of News ArticlesEach student locates three recent news articles (written within the past year) about each of his/her team’s assigned countries (six articles total). The student saves these articles to a virtual or actual binder. S/He writes one paragraph about each article (six paragraphs total). Each paragraph summarizes the article and identifies how what is discussed in the article impacts the country’s economy or is impacted by the country’s economy.Economic ChartsEach team develops a series of graphic organizers that show past and present economic data (i.e., consumer spending, inflation, GDP, and unemployment rates) for each of its assigned countries. Each team also creates additional charts to compare the two countries’ economies. (Target audience: local business owner)Written Report of RecommendationEach team writes a two-page report containing its recommendation regarding which of its countries is the most viable choice for business expansion. In the report, the team explains its reasons for the recommendation and discusses why it doesn’t recommend the other country. (Target audience: local business owner)Oral PresentationEach team develops and shares a three-to-five minute oral presentation that reflects the contents of its written report. Graphic organizers are used during the presentation, and every student participates. (Target audience: local business owner)CriteriaProfessionalExperiencedDevelopingNoviceContentThe information contained in and communicated by the written report of recommendations60 pointsRecommendations are clearly and concisely explained.Recommendations are explained relatively well, but some clarification is required.Recommendations are difficult to follow and understand.Recommendations are incomplete or missing altogether.Recommendations are logical and fully supported.Recommendations are reasonable but lack some support.Recommendations are inconsistent in their logic and lack support.Recommendations are highly questionable and not supported.Reasons for not recommending other country are appropriate and concisely explained.Reasons for not recommending other country are appropriate and somewhat explained, but further detail is required.Reasons for not recommending other country are appropriate, but no explanation is provided.Reasons for not recommending other country are inappropriate or municationAbility to express oneself so as to be understood by others 20 pointsIdeas are expressed clearly and are easy to understand.Ideas are expressed clearly with only a few words being difficult to understand.Both ideas and words require effort to understand.Ideas are vague and elusive, and language is difficult to understand.Report is neat, contains no misspelled words, and is grammatically correct.Report is neat but contains minor spelling and/or grammatical errors that are not distracting.Report is neat but contains spelling and/or grammatical errors that are distracting.Report is messy, with many errors in spelling and grammar.Visual aids support, focus, clarify, and reinforce information given.Visual aids add some support to the information given.Visual aids are related to the information given but do not clarify or reinforce it.Visual aids detract from the information given, raising many questions.CriteriaProfessionalExperiencedDevelopingNoviceOrganizationHow the information is put together20 pointsSections are clearly identified and titled, and material is easily located.Sections are clearly identified and titled; only a few items are difficult to locate.Some sections are not identified or titled, and several items are difficult to locate.Sections run together or are not identified or titled; material is difficult to locate. TopicEconomic SystemsEconomic SystemsAn economic system is the organized way in which a country handles its economic decisions and solves its economic problems. Every country has a slightly different economic system, but there are certain elements found in all economic systems: resources, markets, participants, and a medium of exchange.Why Economic Systems Are NeededOne reason why we need economic systems is because our wants are unlimited, but our resources are not. No country has enough resources to supply everything that its people need and want. One function of an economic system is to decide what can be produced, how much can be produced, and who can obtain what is produced.Another reason why we need economic systems is because people in all economic systems are interdependent. We depend on others to get the things that we need. The economic system coordinates the activities of producers, consumers, and the government. Basic Economic QuestionsEvery economic system must answer three key questions. The way in which each country answers these economic questions is affected by the government. These three questions are:What will be produced?How will products be produced?How will products be allocated?Traditional Economic SystemsTraditional economic systems, sometimes called subsistence systems, are based on traditions passed down through the generations. Members of a traditional economic system don’t make many economic decisions. When they make an economic decision, it is based on habits, customs, and beliefs. People produce the same things that their ancestors produced using the same methods of production. Everything that they produce is consumed by the community, with no thought of incomes, prices, or markets. The major disadvantage of traditional economic systems is that there is little opportunity for growth or improvement. Examples of traditional economic systems include rural areas in Africa and villages in the Amazon mand Economic SystemsIn command economic systems, the government owns and operates most of the means of production and distribution. The government makes economic decisions on behalf of the country with little input from consumers. In addition, there is little or no competition. Communism and socialism are two types of command economic munismIn a communist country, the government controls the entire economic system. It owns and controls the means of production and distribution and does all of the economic planning for the country. People are not allowed to invest in a communist economy. Instead, capital for business investment is provided by the government. The government determines where people should work, what they should do at work, and how much they are to be paid. Major disadvantages of a communist economy include an over-emphasis on the production of industrial goods rather than consumer goods and workers’ inability to improve their economic situation or help themselves. North Korea is one example of a communist economy.SocialismIn a socialist country, the government owns some means of production (used to produce certain basic products), but there is private ownership of business as well. Capital for business investment comes from business profits as well as the government, and workers are free to choose where to work. In socialist command economies (also known as welfare states), the government typically provides its citizens with free medical care, education, and other benefits. However, there is a tradeoff: In exchange for these free benefits, citizens must pay high taxes. Businesses have difficulty competing with state-owned businesses, which can result in inefficient production methods. A good example of a socialist economy is Canada. Market Economic SystemRather than the government owning the means of production and distribution, individuals and businesses are in control of the economy—deciding what to produce, how they will produce the products, and how the products will be allocated. Individuals choose where they want to work, and businesses compete for sales and profits. There are some disadvantages to a market economy, though. Individuals and businesses run the risk of financial loss. Businesses sometimes attempt to capture an entire market for a product so that they can control the product’s price and output. Finally, individuals’ wages vary dramatically, resulting in a significant gap between the wealthy and the poor. Examples of market economies are the U.S. and Japan. ................
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