Pick any two questions (each question should be half a page)
21. How is the Fed structured so the focus of their policies ison the long term health of the U.S. economy, not political gain(which tends to focus on shorter term goals due to election cycles)or personal gain?
22. Zimbabwe’s inflation rate in July 2009 was reported at 1percent a month. Last year, Zimbabwe’s annual inflation rate wasmore than 231,000,000 percent, a kilo of tomatoes cost 61 billionZimbabwe dollars. Compare inflation in Zimbabwe in 2009 with thatin Germany in 1923. Why did Germany print money in 1923 and createhyperinflation? Why is Zimbabwe printing less money today?
23. Baby boomers will result in a massive increase in the SocialSecurity and Medicare benefits that need to be paid. Thegovernment’s Social Security and Medicare obligations are a debt(estimated at $80 trillion) that must be considered when developinga path towards fiscal sustainability. What are the options foraddressing the Social Security and Medicare time-bomb? 24. Explainwhy Australia and Canada have the smallest budget deficits as apercent of GDP.
25. What went wrong in Japan and the United Kingdom thatresulted in large deficits?
26. Design specific fiscal policy you would recommend, given thecurrent state of the economy. What are the demand and supply-sideeffects of the policies you are proposing? How long will it takefor these policies to have their desired effects? What are theshort and long-term effects of these policies?
27. What is financial stability, and what actions has the Fedsince 2007 in pursuit of financial stability?
28. Compare and contrast the Fed’s monetary policy in the GreatDepression and the 2008-2009 recession.
29.Examine China's decision to retain fixed foreign exchangerates.
