What is the Fed and what does it do? In this lesson, students learn the role of the Fed, or Federal Reserve, which is the central bank of the United States, in managing the economy and preventing financial crises through monetary policy. It covers the various ways the Federal Reserve regulates financial institutions, influences interest rates, and stabilizes the economy.
CONCEPTS
Use this video lesson on the topic of understanding the Federal Reserve. Learn basic economic and related concepts of:
- Central Bank
- Monetary Policy
- Interest Rates
- Inflation
- Federal Funds Rate
- Economic Growth
GRADE LEVEL
7-12th grades
TIME REQUIRED
25-35 minutes. It may be necessary to adjust the lesson plan and allocate more or less time to certain topics, depending on the needs and interests of the students.
PROCEDURE
Hand out the worksheet below (see the GET LESSON button near the bottom of the page).
Show students the video and have and have them complete the worksheet. Review the questions on the worksheet. A more comprehensive and detailed lesson plan can be accessed below for further instruction and study.
After watching the video, have students tell what the most important things they learned from the video.
Additional Resources
See our additional resources on economics:
Lesson Plan: Introduction to the Federal Reserve
Objective: To introduce students to the Federal Reserve and its role in the U.S. economy, and to reinforce the key concepts covered in the video.
Grade Levels: Middle School – High School
Time Needed: 50 minutes
Materials Needed:
- Video: “What is the Federal Reserve?”
- Whiteboard or blackboard
- Markers or chalk
- Handout with key concepts from the video
- Discussion questions handout
- Activity materials (optional)
Procedure:
Introduction (5 minutes)
Begin the class by asking students if they have heard of the Federal Reserve and what they know about it. Write their responses on the board. Then, introduce the video and explain that it will help them understand what the Federal Reserve is and what it does.
Video Watching (10 minutes)
Play the video “What is the Federal Reserve?” (see above) and ask students to take notes on the key concepts discussed in the video. After the video, distribute the handout with the key concepts for students to review.
Discussion (20 minutes)
Divide the class into small groups of 3-4 students and distribute the discussion questions handout. Ask each group to discuss and answer the questions. After 15 minutes, bring the class together and ask each group to share their responses.
Activities (15 minutes)
Role Play
Divide the class into groups and assign each group a role related to the Federal Reserve (e.g. Board of Governors, regional bank, commercial bank). Ask each group to discuss their role and responsibilities, and then conduct a role play activity where they act out different scenarios related to the Federal Reserve’s decision-making.
Conclusion (5 minutes)
Ask students to reflect on what they have learned and how it relates to their everyday lives. Remind them that the Federal Reserve plays an important role in the economy and their financial well-being.
What is the Federal Reserve
What is the Federal Reserve? Interest Rates and the Economy
LESSON WORKSHEET
Worksheet includes discussion questions and multiple choice quiz.
Can’t wait to use this lesson plan in my class! It’s challenging to make economics fun and understandable. The video, discussion questions, and role-play activity are all great ways to help my students learn about the Federal Reserve’s role in the economy. Thank you.
Thanks for bringing up the importance of understanding the Federal Reserve in today’s news. I couldn’t agree more that it’s crucial for our students to learn about the Fed’s role in managing monetary policy, regulating banks and financial institutions, and maintaining financial stability.
I believe it’s essential to give our students real-world examples and encourage them to think critically about the Fed’s policies. By doing so, we can help them understand how its decisions can affect the economy and the trade-offs involved in different monetary policy decisions.
These days, it’s so important for young people to be financially literate and to understand how economic policy affects their personal finances. By teaching them about the Fed, we’re giving them the tools they need to make informed decisions and also engage in discussions about economic policy and current events. Overall, I think it’s great that we’re having this conversation about the importance of educating our students about the Fed. Let’s keep working together to help our young people become active and informed citizens!