Lesson Notes By Weeks and Term - Senior Secondary 2

Causes, effects, and control of deflation

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Term: 3rd Term

Week: 9

Class: Senior Secondary School 2

Age: 16 years

Duration: 40 minutes of 2 periods each

Date:       

Subject:      Economics

Topic:-       Causes, effects and control of deflation

SPECIFIC OBJECTIVES: At the end of the lesson, pupils should be able to

  1. Define deflation

 

  1. Identify the causes of deflation

 

  1. Identify the effects of deflation

 

  1. Explain how deflation can be controlled.

INSTRUCTIONAL TECHNIQUES: Identification, explanation, questions and answers, demonstration, videos from source

INSTRUCTIONAL MATERIALS: Videos, loud speaker, textbook, pictures

INSTRUCTIONAL PROCEDURES

PERIOD 1-2

PRESENTATION

TEACHER’S ACTIVITY

STUDENT’S ACTIVITY

STEP 1

INTRODUCTION

The teacher reviews the previous lesson on causes, effects and control of inflation

Students pay attention

STEP 2

EXPLANATION

She defines deflation and identifies the causes of deflation

 

.

 

 

Students pay attention and participates

STEP 3

DEMONSTRATION

She identifies the effects of deflation and explains how deflation can be controlled.

 

 

 

 

Students pay attention and participate

STEP 4

NOTE TAKING

The teacher writes a summarized note on the board

The students copy the note in their books

 

NOTE

DEFLATION

Deflation refers to a persistent fall in the general price level of most goods and services as a result of decrease in the volume of money in circulation. Since the price level falls, the value of money rises during deflation. Deflation is the opposite of inflation. 

CAUSES OF DEFLATION

  1. Restriction on bank lending
  2. Excessive use of budget surplus
  3. Excess supply over demand
  4. Excessive use of fiscal measures by the government 

EFFECTS OF DEFLATION

  1. During deflation, lenders gain at the expense of the borrowers
  2. People on fixed incomes gain such as pensioners and wage earners
  3. Export becomes relatively cheaper than import
  4. The profit margin of the producers will fall
  5. There will be increased unemployment of the factors of production Saving is encouraged
  6. The burden of the national debt increased

CONTROL OF DEFLATION

  1. Use of deficit financing by the government. The government could increase its expenditure relative to its revenue
  2. The government could reduce taxation on incomes
  3. The adoption of the expansionary monetary policy by the central bank
  4. A physical measures of controlling deflation is to increase wages or salaries of public servants

 

Note: Expansionary monetary policy is a policy aimed at increasing money supply in order to increase demand.

 

 

EVALUATION:

  1. Define deflation
  2. Identify the causes of deflation
  3. Identify the effects of deflation
  4. Explain how deflation can be controlled.

 

CLASSWORK: As in evaluation

CONCLUSION: The teacher commends the students positively