Discussion Assignment

Watch the following "time motion" video of unemployment in the United States during the "Great Recession" of 2008. As we will learn in Macroeconomics, 4.5% is the "Full Employment Rate of Unemployment." This means that there is a job available for everyone who wants one, without the production of inflation. Americans are earning and are able to spend.

Discussion Question:

Use the Circular Flow model to offer an (1) an explanation of the economic downturn or (2) a solution to the economic collapse.

Feel free to speculate on the interconnections of the Circular Flow Model as they relate to the economic downturn.

(1) Costs (I) Money income (rents, wages, RESOURCE MARKET (2) Land, labor, capital, terest. pre (sayand (2) Resources entrepreneurial ability (7) (B) Expenditures Resources (10) (9) Goods and services Goods and services BUSINESSES GOVERNMENT HOUSEHOLDS Net taxes Net taxes (11) (12) (5) (6) Expenditures Goods and services (4) Goods and services (4) Goods and services PRODUCT MARKET (3) Revenue (3) Consumption expenditures