Activity 01
Role-Play: Agent Impact Simulation
Assign roles like saver, debtor, wage earner, and firm owner. Introduce inflation or deflation shocks via changing price cards and wage updates. Groups calculate net wealth changes over three rounds, then share findings in a class debrief.
Analyze the impact of unexpected inflation on different economic agents.
Facilitation TipDuring the role-play, assign clear roles with conflicting interests so students feel the tension of redistributive effects firsthand.
What to look forProvide students with a scenario: 'Imagine you are a recent graduate with a student loan and a new job. How would unexpected inflation affect your ability to repay your loan and your overall financial well-being?' Ask students to write 2-3 sentences explaining the impact.
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Activity 02
Data Analysis: Historical Price Levels
Provide datasets on Australian inflation/deflation episodes, such as the 1930s Depression. Pairs graph price indices, GDP, and unemployment, then annotate economic/social costs. Conclude with a short written evaluation of policy lessons.
Explain the dangers of deflation for economic growth.
Facilitation TipFor the data analysis, have students calculate real price changes using CPI data before drawing conclusions about historical episodes.
What to look forPose the question: 'Is deflation always bad for an economy?' Facilitate a class discussion where students must use at least two key vocabulary terms (e.g., debt-deflation spiral, real interest rate) to support their arguments, referencing potential benefits and significant drawbacks.
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Activity 03
Formal Debate: Price Stability Policies
Divide class into teams representing RBA, government, and businesses. Each prepares arguments on managing inflation/deflation using monetary/fiscal tools. Hold structured debate with rebuttals and class vote on best approach.
Evaluate the policy challenges of managing price stability.
Facilitation TipSet a strict five-minute timer for the debate’s rebuttal phase to maintain urgency and focus on policy trade-offs.
What to look forAsk students to identify one specific consequence of inflation for a business and one specific consequence for a household. Then, ask them to explain one challenge the Reserve Bank of Australia faces when trying to control inflation.
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Activity 04
Case Study Analysis: Hyperinflation Analysis
Distribute Zimbabwe or Weimar case studies. Small groups identify costs for different agents, link to Australian context, and propose avoidance strategies. Present key insights to class.
Analyze the impact of unexpected inflation on different economic agents.
Facilitation TipIn the hyperinflation case study, provide raw price data in local currency to emphasize the human scale of the crisis.
What to look forProvide students with a scenario: 'Imagine you are a recent graduate with a student loan and a new job. How would unexpected inflation affect your ability to repay your loan and your overall financial well-being?' Ask students to write 2-3 sentences explaining the impact.
AnalyzeEvaluateCreateDecision-MakingSelf-Management
Generate Complete Lesson→A few notes on teaching this unit
Teachers should anchor discussions in concrete roles and numbers students can relate to, like a retiree’s fixed pension or a family’s grocery budget. Avoid leading students toward a single ‘correct’ view; instead, use the activities to surface tensions between equity and efficiency. Research shows that simulations of inflation’s redistributive effects build empathy and policy intuition, while data work strengthens quantitative reasoning. Watch for overgeneralizing from personal experience—always pull back to macroeconomic aggregates.
Students will leave able to explain specific costs of inflation and deflation, identify winners and losers in each scenario, and justify policy stances using evidence. They should connect economic theory to lived experience and data patterns.
Watch Out for These Misconceptions
During Role-Play: Agent Impact Simulation, watch for students assuming inflation harms everyone equally.
After the role-play debrief, ask each group to list who gained and who lost in their scenario, then compile class results on the board to show unequal impacts.
During Data Analysis: Historical Price Levels, watch for students thinking deflation always benefits consumers.
During the debrief, have students calculate how falling prices increased the real burden of a fixed mortgage taken out in 1930, using provided CPI figures and loan data.
During Debate: Price Stability Policies, watch for students claiming moderate inflation has no real costs.
Before the debate, assign half the class to research menu costs for small businesses and shoe-leather costs for wage earners, then require speakers to reference these in their opening arguments.
Methods used in this brief