Build your students' comprehension of money supply and demand with this engaging and multi-faceted activity!
This activity includes:
1) This "Money Supply and Demand" Activity includes 4 parts. It begins with a colorful graphic organizer that asks your students to define money demand, the two forms of money demand, and explain the factors that contribute to the inverse relationship between the nominal interest rate and quantity of money demanded. Next, students will use data and graphs provided to calculate the change in the quantity of money demanded as the nominal interest rate changes, leading to a downward-sloping money demand curve. Next, students will be asked to identify the 3 components of money demand and will use their knowledge and a collection of data provided to analyze changes in the components of money demand, predict the effects of those changes, and then graph the changes on a money demand graph provided. Lastly, students will be asked to define money supply, explain the constant relationship between the nominal interest rate and quantity of money supplied, and then critically think about how actions of the Fed and changes in money demand will impact the money supply.
This activity can be used in many different ways in the classroom. Students can work independently, in pairs, or this activity can be used as a jigsaw in order to facilitate a class-wide discussion about the topics discussed in the activity.
2) A detailed answer key to the lesson activity to save you time and help guide student comprehension.
This activity can also be found in a bundle paired with a PowerPoint, Keynote and PDF version of a fully customizable lecture found here:
If you like this activity, check out our Unit Activity Bundle that includes activities for all of the objectives in this unit.
Best of all, this activity aligns to our "Unit 4.2 - The Money Market" video lecture, which can be found here:
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