ECO 007: Economic Development

Student Activity Sheets Module #9

Name: Class number: _______

_________________________________________________________________ Date:_______________
Section: ____________ Schedule:_____________________________________

Lesson title: Monetary Policy (Expansionary and Contractionary Materials:

Policy) Student Activity Sheets
Lesson Objectives: References:
1. I can define monetary policy. Economics by Bello, Camacho,
2. I can differentiate expansionary and contractionary monetary Catelo, Cuevas and Rodriguez.
policy.. 2009 edition
Investopedia

“You can’t expect to succeed if you only put in work on the days you feel
like it.”

Establish a routine and follow your own learning policies.

A. LESSON PREVIEW/REVIEW

1) Introduction (2 min)
Hello my dear student! Our topic for today is all about monetary policy. Our previous topics are somehow
connected with our topic today so what’s you’re waiting for. Let’s now start to acquire new knowledge.

2) Activity 1: What I Know Chart (3 min)

Direction: I posted some questions on the second column about our topic for today. Kindly write your
ideas on the first column. There’s no right or wrong answers so feel free to express your ideas.

What I Know Questions: What I Learned (Activity 4)

1. What is monetary policy?

2. What are the differences between

expansionary and contractionary
monetary policy?

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 ECO 007: Economic Development
Student Activity Sheets Module #9

Name: Class number: _______

_________________________________________________________________ Date:_______________
Section: ____________ Schedule:_____________________________________

B.MAIN LESSON
1) Activity 2: Content Notes (13 min)
I will provide the simplest illustration for you to fully understand our topic for today. You can highlight
important key notes that will help you in studying this topic.

Monetary policy, the demand side of economic policy,

refers to the actions undertaken by a nation's central
bank to control money supply to
achieve macroeconomic goals that promote sustainable
economic growth.

Contractionary
Policy
Expansionary
Policy *Tight monetary
policy
*Loose monetary *Helps slow
policy down the
* Helps speed up economy or slow
the economy or economic growth
increase *Designed to
economic growth counteract the
*Designed to effect of inflation
counteract the
effect of
recession

Loose Money Policy Tight Money Policy

1. Borrowing is easy (fall in nominal
and real interest rates)
2. Consumer buy more
3. Business expand
4.More people are employed
5. Depreciation in the exchange rate
1. Borrowing is difficult (higher interest
rates on loans and savings)
2. Consumer buy less
3. Businesses postpone expansion
4. Unemployment increases
5. Appreciation in the exchange rate

Tools of Monetary Policy Expansionary Policy Contractionary Policy

1. Discount Rate Lower discount rate Higher discount rate
2. Reserve Requirements Low reserve requirements High reserve requirements
3. Open Market Operations Buying of securities Selling of securities
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 ECO 007: Economic Development
Student Activity Sheets Module #9

Name: Class number: _______

_________________________________________________________________ Date:_______________
Section: ____________ Schedule:_____________________________________

2) Activity 3: Skill-Building Activities (20 min)

Part 1 Direction: Identify the following scenarios whether they are expansionary or
contractionary monetary policy.
_______________1. Farmers can borrow money in rural banks due to lower interest rates
_______________2. An industrial company opens three branches nationwide
_______________3. Unemployment rate rises due to COVID19 pandemic
_______________4. Dela Cruz family buys a new condominium and latest release of luxury car
_______________5. Mr. X invested in marketable securities
_______________6. Low income earners experience difficulty in borrowing money due to large interest
rate on the principal borrowings
_______________7. Low financing charge in car and housing loan
_______________8. Company A shut down its two business units in NCR to lessen its uncontrollable
administrative costs
_______________9. An investor sells 75% of his investment to support his family needs
_______________10. Your family went to Singapore for a one week vacation

Part 2 Direction: Answer the following questions:

1. On your own opinion based on the context of this activity, what do you think is the importance of
monetary policy for an economy?
__________________________________________________________________________________
__________________________________________________________________________________
__________________________________________________________________________________
_________________________________________________________________________________

3) Activity 4: What I Know Chart (2min)

Go back to Activity 1 and complete the table by writing your answer on the third column.

4) Activity 5: Check for Understanding (5min)

Direction: Rearrange the following letters to form the word related to our topic.

1. IOEECRSNS _________________________
2. NEEEATTIRRTS _________________________
3. YYIOMOCARTNPLE _________________________
4. OIITFANLN _________________________
5. AAEIORYXSNNP _________________________
6. TNRTNROOYAACCI _________________________
7. YTTPLGHOIIC _________________________
8. LLOOOEIPCYS _________________________

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 ECO 007: Economic Development
Student Activity Sheets Module #9

Name: Class number: _______

_________________________________________________________________ Date:_______________
Section: ____________ Schedule:_____________________________________

C. LESSON WRAP-UP
1) Activity 6: Thinking about Learning (5 min)

A. Work Tracker
You are done with this session! Let’s track your progress. Shade the session number you just
completed.

B. Think about your Learning

1. Congratulations buddy! You’re done with this activity. How’s your learning experience? Kindly share
some productive tips you follow to hit our learning targets for today.
__________________________________________________________________________________
__________________________________________________________________________________
__________________________________________________________________________________
_________________________________________________________________________________

2. What is your question about our topic for today?

__________________________________________________________________________________
__________________________________________________________________________________
__________________________________________________________________________________
__________________________________________________________________________________

KEY TO CORRECTIONS

Skill Building Activity

Part 1
1. Expansionary
2. Expansionary
3. Contractionary
4. Expansionary
5. Expansionary 8. Contractionary
6. Contractionary 9. Contractionary
7. Expansionary 10. Expansionary

Part 2
Suggested Answer:
1. Monetary policy helps to stabilize the levels of inflation, unemployment rate and interest rates.

Check for Understanding

1. RECESSION 4. INFLATION 7. TIGHT POLICY
2. INTEREST RATE 5. EXPANSIONARY 8. LOOSE POLICY
3. MONETARY POLICY 6. CONTRACTIONARY

Submit your activity sheets before the end of the session!

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