"drawing board" on their website. Watch the following video (Click on post title to go to video) and in your post you must do two things.
1) Come up with a legitimate higher order thinking question over material covered in the video.
2) Provide an answer to someone else's question that they posted. (In your answer be sure to list whose question it is you are answering.)
3) Once someone's question is answered it is no longer usable by anyone else.
3) Once someone's question is answered it is no longer usable by anyone else.
My Question #1"How is the Economy like Goldilocks?
107 comments:
1. If the minimum wage increases, how will it affect the company's profit?
2. The economy doesn't function at its best when its running too hot or too cold. Inflation rates are high when the economy is hot and the demand will decrease if the prices of goods and services increase and people are on a fixed income. Deflation occurs when the economy is too cold. People will wait to purchase goods later on if they believe the prices will go down and this will slow down the economy. For the economy to function well, it must be just right.
Abel Abraham
6th Period
1. How do changes in inflation redistribute wealth amongst borrowers and lenders?
2. (Question from Abel Abraham). As the minimum wage is increased, the price of cheap labor can be pushed up past it's equilibrium price point. This results in a company losing money in profits since it must now pay it's workers more without any change in how much they output. This is what leads companyies to lay off workers and results in unemployment.
Jahrid Clyne
6th Period
1. Why do lenders increase their interest rates as the inflation rate of the market becomes less predictable?
2. Jahrid Clyne- As the rate of inflation increases, lenders tend to lose the profit they would've achieved through a business deal allowing for the borrowers to keep more money because the value of the money owed would be less. However, if deflation begins in a nation the lender would be making even greater profit while the borrower would lose money he/she never borrowed. Thus, the redistribution of wealth depends on the direction of inflation and because of increasing inflation rates, we see higher interest rates in small loans.
Jibimon Noby
Period 1
1. Why is it difficult and risky for a country to maintain low and stable inflation rates?
2.(Jibimon Noby) Lenders tend to increase their interest rates when the market becomes less predictable so that if the inflation rate were to suddenly rise, the lender's would still have a chance to profit. It gives the lender cushion for sudden inflation rises. It compensates for the money that would be lost from inflation increases.
Henry Feng
7th Period
1. What is one consequence of high inflation?
2. They are hard to produce. For example, central banks like low inflation rates but they have to be cautious about setting targets too low because the economy always faces shocks. When these shocks come we want something to absorb it. (Henry Feng)
Nia Eugene
Per. 6
1.What causes the product of demand to decrease?
2.One consequence of high inflation is that if you are in a fixed income the purchasing power errodes. If prices around the board rise and your income doesn't, you have less purchasing power causing people to spend less. In result you will have less demand in goods and services,causing people to cut back and also resulting in businesses to cut back and having people lose their job. ( Nia Eugene)
Mykaela Llacar
6th
1. How would an interest premium affect loans in a more stable economy?
2. (Mykaela Llacar) The product of demand will decrease if consumers expect the economy to drop. Consumers, expecting lower prices in the future, will hold off on purchases, which will cause the economy to drop, therefore causing the buyers to continue waiting until prices drop even more.
Sarah James
2nd Period
1.) What is an advantage of keeping prices stable?
2.) Since the price of bonds and loans are directly related to interest rates, a fixed-income is purchased at a premium, this means that then-current interest rates are lower than the coupon rate of the bon or loan. (Sarah James).
Katarina Shanar
6th period
1. How does the stability of the economy affect the demand for goods and services?
2. the advantage of keeping the price stable is to maintain confidence in the market which makes consuming a product easier for people.
Hunter Boyd
Period 6
1. (Hunter Boyd) If the economy lacks stability, it can have a negative impact on the demand for goods and services. For example, if prices rise across the board, the demand for good and services decrease resulting in business stepping back and eventually leading to unemployment. On the other hand, if prices are falling, people will delay making purchases thus decreasing the demand for goods and services as well.
2. What is the effect of having less purchasing power?
Reba George
period 1
1. The effect of having less purchasing power is that it will have an negative impact on consumers, currency exchange rates, and the national economy.
2. Why do we need additional stimulus to the economy?
1. The effect of having less purchasing power is that it will have an negative impact on consumers, currency exchange rates, and the national economy. (Reba George)
2. Why do we need additional stimulus to the economy?
1. What is one way inflation affects business owners?
2. (Sarah james) An interest premium would cause loans to have increased monthly payments and the effective interest rate you would pay over time for the loan.
Tammam alhiraky
1st period
1. If we are able to kept our economy just right with it not being to hot or to cold why does it change?
2. (Linda Zhu) we need additional stimulus in the ecomomy because if the economy isn’t flowing then it doesn’t balance business and people will lose jobs which mean no money will be made and we’re all doomed.
Elizabeth Melchor
2nd period
1. How would higher interest premiums lead to job loss?
2. (Elizabeth Melchor) Ultimately, the business cycle prevents us from keeping our rates at a constant level. Countries that prefer a low interest rate are even aware that shocks in their economy may occur as a result of the business cycle. Our economy is constantly changing in the short-run. While there may be a positive trend upwards for the long-run, in the short-run economy, we will experience periods of expansions and recessions, which will shock the economy and affect consumer purchasing power/confidence. As a result, although the government may attempt to hold prices stable, shocks are bound to occur and must be accounted for.
Angella Baby
Period 1
1. How would a change in inflation rates in other countries affect the American economy?
2.( Angella Baby) HIgher interest premiums will lead to a decrease in the amount that people will borrow from different business, therefore, fewer business will be sustained creating a lack of jobs.
Nikita
Damodaran
Period 2
1. How does buying power affect businesses?
2. (Nikita Damodaran)How would a change in inflation rates in other countries affect the American economy?
Changing inflation rates in other countries affect the US buying power when it comes to buying
foreign goods. If another country has an increase in inflation rates while the US economy remains the same, then the US dollar has gained more buying power, allowing the US economy to buy more goods for their dollar.
Andrew Yang
7th
1. Does delaying to make your purchases due to knowing that prices may fall in the future affect the economy in an indirectly healthy way?
2. (Andrew Yang) Buying power helps affect businesses as buying power is the money an investor has available to buy securities. In a margin account, the buying power is the total cash held in the brokerage account plus maximum margin available. The presence of this can overall help the businesses and companies flourish.
Blesson Chacko
7th Period
1.How do bankers plan for inflation when giving loans to customers?
2. (Blesson Chacko) Delaying to make a purchase indirectly affects the economy in an unhealthy way rather than a healthy way. It lowers the demand of a product and can lead to cut backs from companies because of the decreased demand of their product.
Brandon Wong
7th
1.How do countries prepare for shocks in the economy?
2.(Brandon Wong) Lenders decide to increase their interest rates with the idea of interest premium. Which then later there would be less people borrowing loans, which results to slowing down the economy, etc..
Michael Ibay
7th period
1. How do unstable markets and fluctuating prices impact consumers?
2. (Michael Ibay) Countries tend to change the federal funds rate in order to prepare for shocks in the economy because since it regulates bank reserve levels, it is a very efficient way to control the impact of economic shocks.
Ashwini Prabhu
Period 6
1. How does the government manage to keep their inflation rates predictable?
2. (Ashwini Prabhu) Unstable markets and fluctuating prices impact consumers by not buying at a certain time. This event causes the economy to slow down.
Angela Fang Period 6
1. How does employment play a factor towards rise or fall in inflation?
2. In response to Angela Fang the government policies are made more predictable and stable, so that inflation rates and interest rates would be more predictable and stable too. Exchange rates would bounce around less, too.
Jeslin Johny
1st period
1.What are some factors that make it hard for you to pay off debt?
2.(Jeslin J.)When unemployment is low inflation rises, and when employment is steady it neutralizes the ration of inflation.
1. What are the consequences of the price going down?
2. (Camryn Pugh) Factors that make it hard for you to play off debt are if the prices are falling your debt will stay the same and business are struggling could make wages decrease making it harder to play off that debt.
Hannah Golding
1st
1.What are some factors that make it hard for you to pay off debt?
2.(Jeslin J.)When unemployment is low inflation rises, and when employment is steady it neutralizes the ration of inflation.
Camryn P 6th
1. What is a peril for when the economy is “too hot”, “too cold”, and unpredictable?
2.(hannah Golding) The economy would experience deflation and people would delay making purchases, which can cause businesses to struggle in the time being. This would cause demand, production, and employment rate to all go down.
1. How does high inflation make running a business more unpredictable?
2. (Bailey Corley) When the prices of general goods are rising at a rapid pace (too hot), we lose purchasing power and people ultimately spend less money which leads to less demand and less production/employment. When the prices of general goods are declining (too cold), people hold their purchases for expectancy of lower future prices. As people keep waiting to spend their money, demand will decrease, as will production and employment. When the economy is unpredictable it leads to poor business choices because one can’t always determine the weight of the negative effects of inflation or the increasing costs of goods.
Lujayna Taha
2nd
1. Why are declining prices actually bad for buyers?
2. (Lujayna Taha) When there is high inflation, buying things can be based off of either inflation or the prices of raw materials rising. If you were to guess that it is the price of the materials rising and it turns out to be inflation then you have lost money.
Bonita Hall
6th period
1. How do high premiums slow down the economy.
2. (Bonita Hall) Declining prices are bad for buyers because it means that the economy is slowing down which could lead to demand for products going down which leads to business declining production which leads to people losing their jobs.
1.Why is it important to know if the good your purchasing price changes is due to inflation or raw material prices?
2. (Gerardo Guzman) With a high premium people tend to stop purchasing items, lowering the demand for goods, in return lower the economy.
Danielle Davis 6th
1. How could buyers discern between a rise in prices of materials or inflation when buying?
2.(Danielle Davis) the importance of knowing why prices are rising keeps buyers aware of where the economy is headed, it would also protect them from poor business deals.
Keegan Jones 7th
1) How does inflation rate affect the success or decline of a company/business?
2) (Danielle Davis) It is important to know if the good purchased price changed due to inflation or raw material prices because it will ultimately affect the success rate of the business. For example, if the change was caused by inflation then it is probably temporarily and will go back to normal sooner than later, however if the price changed due to the raw material prices then this can result in a long lasting toll on the company’s success.
Sahib Oberoi 2nd
1.Why is a low inflation good for consumers who do not have wage difference from the year before, where the inflation rate was high?
2.(Sahib Oberoi) Inflation can affect a company by affecting the company's profit margins. With increasing prices for goods, it means that the input for the good that company sells increases and that means if they want to sell the product at the same price point they are not able to get the same amount of profit.
Paul Manavalan
7th Period
1. If a country were to experience high inflation for a substantial period of time, how will this affect the nominal interest rate?
2. (Paul Manavalan) Low inflation for such consumers is beneficial because they are now able to purchase goods at a reasonable and lower price. This year they don't have to spend as much on a product as they did the previous year if their wage stayed consistent.
Erin John
Period 2
1. If the economy had to choose between a 4% inflation rate or a 4% deflation rate, which option do you think is better for the economy?
2. (Erin John) If a country were to have a high inflation rate, then interest rates would also go up so that bankers can continue to have the same profit levels.
Jerin Jose
Period 02
1. How can overproduction (high supply) lead to underproduction (low supply)? Hint: Falling prices are bad
2. (Jerin Jose) Neither option is better; both a high inflation rate and a high deflation rate are bad for the economy in their own ways.
Samuel Shteyman
1st Period
1. How would the economy be without debt and why is debt a necessity in our economy?
2. (Samuel Shteyman) If too much of a product is produced and there is no demand that could lead to a reduction of prices which would drive up demand, thus leading to low supply.
Dhilan Patel
7th Period
1. How is the employment rate affected when the economy is "too hot"?
2. (Dhilan Patel) The economy would be without debt if it were stable and between "too hot" and "too cold". Debt is a necessity because it makes people continue to participate in the economy.
Matthew Manalel
2nd Period
1. If the prices rise and your income stays the same then what happens to your purchasing power?
2. (Matthew Manalel) When the economy is too hot then there is high inflation.
Sumeyye Islamoglu
1st Period
What happens to the production when the economy is too cool?
The prices rise rises and income stays the same it actually decreases your purchasing power because you may no longer be able to afford that resource to make your product.(Sumeyye Islamoglu)
Kenan Edwards
6th Period
1. If inflation rises, how does it help/not help a house buyer who borrowed money from the bank as mortgage.
2.(Kenan Edwards) The economy being cool is when the prices for items start falling. Although this creates demand, but the downside will be that people will assume the prices will fall even more which creates delay in purchase. This can cause a decrease in demand, production and create more unemployment.
Godwish Tom
1st Period
1. How does prices rising unstably lead to a rise in unemployment?
2. (Godwish Tom) The borrower already owed money before the inflation occurred, the inflation benefits the borrower. The borrower still owes the same amount of money that they owed at the start.
1.) How is having a little inflation healthy for the economy?
2.) Prices rising unstably can lead to a rise of unemployment by increasing the cost of input. When the cost of input increases, businesses may respond by laying off workers. (Simran Kotak)
Stephen Iype
1st period
1. How do lower unemployment rates affect inflation, and why is inflation bad for the economy?
2. (Stephen Iype) It creates a balance within the economy that allows the prices to remain within a reasonable range.
Nicole Jean
1st period
1. Does the strength of the dollar in foreign money markets affect the inflation rate?
2. Lower unemployment rates affect inflation because when there is a decrease in employment rates, there is, consequently, an increase in demand which will cause firms to raise prices even quicker. (Nicole-Marie Jean)
Angie Mancino
period 6
1. Although when is the economy is "too cool" allows consumers to buy products at a discount, what is one downside of deflation?
2. (Angie Mancino) The rate of inflation in a country can have a major impact on the value of the country's currency and the rates of foreign exchange it has with the currencies of other nations.
Anson Sam
period 6
1. What effect does inflation have on smaller companies?
2. (Anson Sam) A downside of deflation is that it causes lower wages or salaries to employees as companies don’t have profits to pay its employees.This will end up creating a cycle where no one wants to spend anything.
Reeba Abraham
period 2
1. What is the risk of a company buying resources at an increased cost? How can this be a bad business decision?
2. (Reeba Abraham) Inflation has a negative effect on smaller companies. If prices rise and employee's income's do not, these working people are less likely to spend their money. This causes a lower demand for products, thus, smaller companies are not able to sell as much as they normally would.
Garrett Foresman
Period 6
1) Why not have low inflation rates?
2) (Garret Foresman) A risk of buying resources at an increased cost can make business more unpredictable. This is a bad decision because you just sank capitol in the cost of rising inflation.
Ashley Odstrcil
7th period
1)What are interest premiums and how do they effects the economy?
2) (Garrett Foresman) Some risk associated with buying resources at an increased cost is the unknown of if the price is higher because of product manufacturing or inflation. With the increase of prices some companies will loose money. In the future the companies will want to wait for the prices to decrease which could be a bad business decision because the princes could just go up further. This also hurts the economy by not doing business in anticipation of lower prices.
Jessica Neal
Period 2
1. Why has the inflation rate been hard to get down to 0% or 1%?
2. (Ashley Odstrcil)Having low inflation rates can also hurt the economy in the long run because, people will start spending less money right now if the know whay there are buying is going to decrease in price. Therefore, the economy will suffer becaus the amount being put in isn’t the same going out. So people could eventually end up loosing their jobs as companies cut down on production.
Albert Tamdjo
Period 2
1).How does high inflated rates affect a fixed income?
2).(Albert Tamdjo) Having Low inflation rates between 0-1 percent are hard to produce even though appealing. Certain banks like low inflation rates are nervous set low target prices because the economy can face a shock with Barely any economic activity. Therefore, The federal reserve has limited opportunities to stabilize the economy.
Amaani Nazarali-6th Period
1) How would you keep the price of a product stable so that the economy wont go hot or cold?
2) (Amaani Nazarali) Inflation is a risk factor that affects all investments. It's especially magnified with fixed income ones. Inflation is the gradual and subtle erosion of the buying power of your dollars over time. Fixed income investments pay a steady amount of dollars of interest and return a set amount of dollars of principle at maturity. The buying power of those dollars diminish each and every year that passes.
Amilcar Rivas
6th
1)If there is high inflation in the economy, what would need to be done in order for the economy to become stable again?
2)(Amilcar Rivas)In order to keep the price of a product stable so that the economy won't go hot or cold, consumers would need to spend money at a consistent rate in order to prevent producers, interest rates, and other economic factors from adjusting, resulting in inflation or deflation.
Irene Gratil
2nd
1) How does interest premium effect a family’s financial status if they took out a loan to pay for their kids College tuition?
2) (Irene Gratil) One popular method of controlling inflation is through a contractionary monetary policy. The goal of a contractionary policy is to reduce the money supply within an economy by decreasing bond prices and increasing interest rates. This helps reduce spending because when there is less money to go around, those who have money want to keep it and save it, instead of spending it.
Edward Joseph
Period 2
1). How have inflation rates affected the U.S. economy as a whole in the past century?
2). (Edward Joseph) Interest premium *affects a family's financial status if they took out a loan by how many loans they are willing to take out. If there is a high rate, the family will take out more loans, as compared to a premium with low rates. Many families now struggle to pay off their loans, and some never completely do.
Christian Toy
Period 1
1. Ideally, what should be the goal of the Federal Reserve's monetary policy?
2. (Christian Toy) Inflation rates have revealed certain facts about the economy. Energy is the most volatile of all price commodities. Inflation rates and unemployment are now the economic indicators that are looked at the most.
Paul Pullan
1st Period
1. Why are fairly lower, but stable inflation rates harder to create?
2. (Paul Pullen) The goals of monetary policy should stay as they are to promote full employment, moderate prices, and decent long-term interest rates. By doing so, the Fed can maintain stable prices and support conditions for economic growth and employment prosperity in the nations long run.
Raza Muhammad
Period 2
1. How is the unemployment rate in the economy affected when it is "too hot or too cold"?
2. (Raza Muhammad) Low and Stable inflation rates are very difficult to create because, businesses have channeled more resources into portfolio management in order to avoid financial losses. This is an inefficient use of productive resources that do not generate wealth to society.
Maheen Meraj
6th Period
1. What is the main problem with having the inflation rate at 0-1% although appealing to attain?
2. (Maheen Meraj) The unemployment rate is affected by a hot economy when the prices raise, inflation, decreasing demand and consequently production forcing employers/businesses to cut down and lay off employees. In a cold economy low prices for too long of a time decrease the demand by creating an expectation among the population that the prices will fall, therefore, production levels decrease leading to less jobs needed.
Luke Leblanc
Period 6
1. What could be the major drawbacks of too high of an inflation rate?
2.(Luke Leblanc) the main problem with 0-1 % inflation rates is that it might be ideal but is hard to maintain and the constant threat of an economic shock.
Peter Martin
P.2
1. How can one bring an economy back into a stable condition from being "too cool"?
2. (Edward Joseph) An interest premium can hurt the family's financial status if they took out a loan to pay for their kids college
Benjamin Sunny, Period 6
1. What happens to debt when inflation occurs?
2.(Peter Martin) The major drawbacks with having the inflation too high would lead to falling incomes, an increase in consumer uncertainty, and a rise in business competition.
1. Why is it important to judge if the price of a good has risen due to inflation or related to supply and demand?
2. (Bailey Corley) The purchasing power of people on fixed incomes erodes if prices are too high and people may delay making purchases if they think the prices of goods are going to fall in the future.
1. What are a few possible downsides for a rapid increase in the economy?
2. In response to Benjamin Sunny, for one can bring an economy back to sable conditions from being "too cool," the prices of products would need to become stable.In order to do this consumers would have to spend money at a consistent rate to prevent inflation or deflation due to the demand for products decreasing.
Roshni Jose
Period 1
1) What is way, if there is, to steadily keep inflation between the ideal 0%-1%?
2)(Ayush Singh) The debt would be harder to pay off because inflation could slow demand which in turn would cause the company you work for to lay you off or cut your wage and make that debt much harder to pay off.
1) What are the benefits of stable prices as it relates to maximum employment?
2) In response to Roshni Jose, an economy that is increasing or experiencing a rise in prices has a downside of a lower purchasing power. This means that the value of goods that people are willing and able to buy decreases. As a result, another downside occurs when the demand for certain goods decreases due to inflation. Less people spend money, leading the economy into recession.
1) What is the link between purchasing power and unemployment?
2)Stable prices allow for consumers to purchase what they need reliably at all times and therefore spend their money instead of saving it. This allows for more buisnesses to stay open and hipe more workers as they have the miney ti do so.
Alisha Zuté Period 6
1)how does low inflation affect the economy?
2)(Alisha Z) the link between purchasing power and unemployment is that when you are unemployed you have low purchasing power. Which affects the economy by the demand is falling with unemployment.
Jacob Aickareth
2nd period
1. How can shocks be absorbed?
2. (Luke Leblanc) The main problem with having the inflation rate at 0-1% although it is appealing to attain is that it is always vulnerable to an economic shock. It is also very difficult to achieve.
1. When price is going in every direction,why is this bad for loan lenders?
2. (Lauryn Ewens) As a producer, it is important to judge the rise in prices of a good as inflation or related to supply and demand because if it were related to supply and demand you would lose capital due to inflation. This would be a bad business decision due to loss in profits.
Angel Yeung
Period 6
1. How come the bank tellers charge a consistent inflation rate separate from the government?
2. (Hannah Golding) Prices going down mean lower spending, lower demand, and company cutbacks
Erek Castro 7th
2. Answering question again because it was already answered.
(Jacob Aickareth) Low inflation affects the economy by slowing down the economy, making the demand of products go down, causing people to lose their jobs, and businesses to cut down.
Camila Ferrero
Period 1
1. Why might collateral contracts hinder the growth of a business?
2. Erek Castro- Bank lenders keep a constant interest rate to adjust for the national inflation rate. The government's interest rate is used as a backup for the instability of these rates and to prevent further economic turmoil. Bank lenders are careful in choosing their number to make their profit.
Angelica Miranda
Period 2
What is an alternative way to detecting the difference between good business and inflation?
Answer to Angelicas question: A collateral contract could hinder the growth of a business because of the fact that the main contract that two parties have agreed to could have some issues and in the long run the bank might not grant a loan because of the collateral.
What is the biggest affect of inflation on the economy?
Angels question:
Loan lendors would not know whether their investments would be returned because of the uncertainty in prices
1. what is beneficial of keeping the prices around us stable?
2. angel yeung- sometimes the value of money will go down and with inflation the loans given will be worth
less and thus, the loans will lose its value as compared to before.
tiffany huynh
How does inflation affect large corporal companies and small private business?
(Tiffany Huynh)- If the prices are stable, the country can avoid inflation and deflation which can have huge consequences on the economic state of the country.
Alan John
Period 2
1.Why is it bad for the economy to not spend money
2.If prices were to go down rapidly people would not spend money and wait. The employers would lay people off.
Reece lasris
Period 2
1. How does a “waiting” mentality affect the economy (what are the side effects of it)?
2. (Alan’s question) Larger corporations are generally better positioned to bear the brunt of inflation. Small firms, however, often take a direct hit as it can increase the cost of production.
Javier Bermejo
Period 2
1. Does high inflation or deflation affect middle class workers who work for hourly wages more?
2. Javier Bermejo - People are prone to waiting for lower prices under the assumption that a better deal would come along. This lowers overall demand and businesses cutting back which causes a decrease in jobs.
Paul Nguyen
2nd period
1.Why are "Price Stability" and "Maximum employment" considered "Two sides of the same coin?"
2. Paul Nguyen - yes
Mark Mufarreh 1st
1. How does inflation affect small businesses
2. Paul Nguyen- Inflation is favorable for the middle class because it provides more time for them to pay off loans/debts.
Kollin Chang
2nd period
1. Why is it a bad thing when the economy is too hot?
2. Inflation negatively impacts small businesses. inflation causes people to spend less and when people spend less, small businesses will be the first to go under.
Matthew Benton 6th Period
Bryanna Godfrey
Period 1
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