How does the economy work? Pull a lever and find out.
Move interest rates, taxes, spending, oil prices and more. The chart instantly shows what happens to jobs, prices, growth, bond rates, stocks and housing over the next five years.
Five-year outlook
Shaded areas mark recessions and other trouble. Click the chart to inspect a quarter. A simplified teaching model — not a forecast.
What’s happening — cause & effect
Aggregate demand & supply
Five ways to explore the economy
- Slide a lever. Every policy tool and outside shock is on the right. The chart and numbers update instantly.
- Compare to “no change.” Dashed lines show what would happen if you had left everything alone.
- Lock a result. Open Results and click 🔒 to hold inflation, unemployment or any other result fixed — “all else equal.”
- Turn factors on and off. The ⏻ button removes a factor’s effect so you can isolate one cause at a time.
- Read the forecast strip. Colored blocks show the economy’s condition each quarter: expansion, slowdown, recession, depression, stagflation…
What the colors mean
| Healthy expansion | Normal growth, ~2% inflation, low unemployment | |
|---|---|---|
| Boom | Growth above ~4% | |
| Slowdown | Growth weak but positive | |
| Recession | Output falling, unemployment rising | |
| Depression | Severe, long recession; unemployment 12%+ | |
| Stagflation | High inflation and weak growth together | |
| High inflation | Inflation above ~6% | |
| Hyperinflation | Runaway inflation (50%+) | |
| Deflation | Prices falling |
More ways to learn macroeconomics
History Replay
Watch real U.S. data replay the 1929 crash, the 1970s, 2008 and 2020 — then ask “what if the Fed had acted differently?”
🎯Predict & Play
Read a scenario, predict where unemployment, inflation and GDP will go, then play it out and see if you were right.
⚖️Supply & Demand Lab
The micro side: shift curves, add taxes, price ceilings and floors, and see surplus and deadweight loss.
🏡Housing Market Lab
How mortgage rates, incomes, zoning and credit decide what a home costs — and what you can afford.
🏦Money & Banking Lab
See how banks create money through lending, and how reserve requirements change the money supply.
🍎For Teachers
Lesson plans, classroom codes to track quiz results, projector mode and an embed code for your course site.
Frequently asked questions
Is this an accurate forecast?
No — it’s a teaching model. It captures the main cause-and-effect relationships taught in AP and college macroeconomics (aggregate demand and supply, the Phillips curve, Okun’s law, the Taylor rule, crowding out) using simple, transparent equations. Real economies are messier. See how the model works.
Why does inflation keep rising when I cut interest rates?
In the simulator the Fed holds its rate exactly where you put it. Real central banks adjust. Press A on the interest-rate slider to let the Fed follow the Taylor rule and see the difference.
Can I use this in my class?
Yes — it’s free. Share a scenario link, use projector mode, or embed the simulator on your course page. Teachers can create class codes to see students’ quiz results.