Economic Forecasting: An Internet WebQuest@

Introduction | Tasks | Resources | Process | Evaluation





Introduction
Economics is often called the "science of decision making."  The decisions that economists analyze range from personal decisions such as how big a pizza to order or whether to buy or lease a new car to the decisions the federal government makes about things like the size of our military.  Economists use information about these, and other decisions, to develop indicators that can be used to determine the health of our economy.  Just as a physician relies on indicators such as temperature, blood pressure and heart rate to determine the health of a patient, economists use indicators like gross domestic product growth, the unemployment rate and the rate of inflation to predict our nation's economic health.

How do economists make their forecasts about the U.S. economy?   In this lesson you will use the Internet/WWW retrieve up-to-date key economic statistics which will provide valuable hints about the state of the future economy. When the lesson is complete, you will have a new understanding of how economists predict our economic future

Introduction | Tasks | Resources | Process | Evaluation

Tasks
You are a partner in an economic forecasting firm called Acme Economic Forecasters (AEF).  You and your partners have just received a letter from a business woman in Australia who is interested in moving her guava jelly business to the US.  She has asked you to prepare a report on the expected economic health of the US economy for the next year.

You and your AEF partners will need to do the following:

Introduction | Tasks | Resources | Process | Evaluation

Resources
Use the following links to resources that may help you and your AEF partners prepare your report to your client:

A Pedestrian's Guide to the Economy
Economics Briefing Room
National Council's DataLinks
Essential Principles of Economics: A Hypermedia Text
USA Today's Economy Track


Introduction | Tasks | Resources | Process | Evaluation





Process
In order to complete your client's report, you will need to complete the following tasks:

  1. Briefly (1-2 sentences) describe each of the 3 leading economic indicators: GDP, inflation rate, and unemployment rate.  Include a description of the impact of each indicator on the nation's economic health (e.g., why is GDP a measure of the US economy's performance?)
  2. Briefly describe the trends in each indicator over the past 12 months (e.g., is GDP up? By how much?)
  3. Print out a graph/chart for each indicator that shows the trend of that indicator over the last 12 months
  4. Compile these pieces into a coherent recommendation to Ms. Jones.  You may wish to develop a PowerPoint presentation to give your report to Ms. Jones.  Should she bring her guava jelly business to the US?  What is the outlook for the economic health of the nation?
  5. When you have finished your report log on to>>>>>>> and post your recommendation to Ms. Jones there.  Your recommendation should include data from your investigation.
Introduction | Tasks | Resources | Process | Evaluation





Evaluation
Evaluating the accuracy of your forecast will take time.  Over the next few months, various predictions about the future health of our economy will emerge.  Often economists are surveyed to determine their beliefs.  Here is an example of such a survey.  Watch the newspaper and listen to financial news reports to compare your firm's forecast with that of professional forecasters.  Were you right in your advice to Ms. Jones?

You can also log back onto the web board and check the recommendation of other Acme Economic Forecasting firms.  Where they similar to yours?  How?  Different?  In what ways?

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@Based on the popular "WebQuest" WWW activity format developed by Bernie Dodge.  For more information on WebQuests, see Dodge's WebQuest Page
 
 

Economics WebQuest Page

WebQuest developed by

Phillip VanFossen
Center for Economic Education
Purdue University

updated: 28Sept99