A SPREADSHEET-BASED ACTIVE LEARNING MODEL TO TEACH THE SHUTDOWN DECISION

Abstract

Teaching economics in undergraduate classes, particularly at the introductory level, while keeping the students engaged and interested in the subject matter is a challenging task. “Chalk and talk” is still the dominant teaching method in undergraduate economics. However, in such traditional lecture settings, students often lose interest in the subject matter particularly when the emphasis is on graphical exposition. Active learning strategies where students are engaged in their own learning are regarded as more effective in generating and retaining student interest. In this paper, I demonstrate how to develop and use an active learning model using the visual interface of Excel that students themselves can control. The model in this paper shows how to teach acompetitive firm’s shutdown decision. The technique of developing such a spreadsheet-basedmodel is discussed in detail. Using this methodology, active learning models can be used to teach other topics in both microeconomicsand macroeconomics, such as tax incidence, deadweight loss or effectiveness of macroeconomic policies among others. Since both professors and students are familiar with Excel, these active learning models create a familiar teaching-learning environment.