Lesson Plan

• Describe why inflation is targeted and its macro‑economic consequences.
• Explain how monetary‑policy instruments transmit to the real economy.
• Compare the short‑run and long‑run effectiveness of monetary, fiscal and supply‑side policies.
• Analyse how time lags, expectations and global factors influence policy outcomes.
• Apply an AD‑AS diagram to illustrate the impact of a contractionary policy mix.

• Projector and screen for slides/diagrams
• Whiteboard and markers
• Handout summarising policy tools and effectiveness table
• Calculator or spreadsheet for quick calculations
• AD‑AS diagram worksheet
• Sticky notes for quick checks

Begin with a short poll asking students to name two problems caused by high inflation. Link their answers to the lesson’s success criteria: students will be able to explain and evaluate policies that bring inflation down.

1. Do‑now (5’) – Quick quiz on the definition and costs of inflation.
2. Mini‑lecture (10’) – Why governments target inflation and the policy objectives.
3. Interactive presentation (15’) – Monetary‑policy tools and the transmission mechanism (including MV=PY).
4. Group activity (12’) – Analyse a specific tool using the effectiveness table and complete a worksheet.
5. Fiscal & supply‑side overview (10’) – Brief discussion of complementary policies.
6. Case‑study simulation (15’) – Teams design a policy mix for a fictional economy, justifying choices with time‑lag and expectations considerations.
7. Whole‑class debrief (8’) – Share proposals, link to AD‑AS diagram, highlight strengths/weaknesses.
8. Exit ticket (5’) – One‑sentence answer: “Which policy is most effective in the short run and why?”

Recap the key transmission steps and the relative effectiveness of each policy tool. Collect exit tickets to gauge understanding, and assign a homework task to create a short written comparison of two policies using the checklist provided.