Unit 2
Economic Indicators and the Business Cycle

Unit 2.1 Circular Flow and GDP

​LEARNING OBJECTIVE:
a. Define (using the circular flow diagram as appropriate) how GDP is measured and
     its components.
b. Calculate nominal GDP.

Unit 2.2 Limitations of GDP

​LEARNING OBJECTIVE:
​Define the limitations of GDP.

Part 2 Primary Source Analysis

Part 3 Analyzing Data

Unit 2.3 Unemployment

​LEARNING OBJECTIVE:
a. Define labor force, the unemployment rate, and the labor force participation rate.
b. Explain how changes in employment and the labor market affect the unemployment
​     rate and the labor force participation rate.
c. Calculate the unemployment rate and the labor force participation rate.
d. Define the types of unemployment and the natural rate of unemployment.
e. Explain changes in the types of unemployment.

2.3.2 Unemployment

Unemployment Rate

Labor Participation Rate

Unit 2.4 Price Indices and Inflation

​LEARNING OBJECTIVE:
a. Define the consumer price index (CPI), inflation, deflation, disinflation, the inflation
     rate, and real variables.
b. Explain how price indices can be used to calculate the inflation rate and to compare
​     nominal variables over time periods.
c. Calculate the CPI, the inflation rate, and changes in real variables.

Part 4: In the News

Unit 2.5 Cost of Inflation

​LEARNING OBJECTIVE:
Explain the costs that unexpected inflation (deflation) imposes on individuals and the economy.

Unit 2.6 Real vs Nominal GDP

​LEARNING OBJECTIVE:
a. Define nominal GDP and real GDP.
b. Calculate real GDP and the GDP deflator.

Unit 2.7 Business Cycles

LEARNING OBJECTIVE:
a. Define (using graphs and data as appropriate) turning points and phases of the 
     business cycle.
b. Explain (using graphs and data as appropriate) turning points and phases of the
​     business cycle.

2.7.1 Part 2 Making Connections

2.7.2 Part 2 Article Analysis