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~ Final Exam Review Questions ~



"Maestro"
1)  T/F, Explain. The video "The Fed Today" informed us that the Federal Reserve System was created only for the purpose of 'regulating and supervising the banking system' to prevent bank failures. A visit to the "Board of Governors of the Federal Reserve", and the   "The Federal Reserve Banks" may be instructive.


"The New Guy"

2)  The New York Times recently reported that: "Fed May Raise 'Rate' By Quarter Percent". What 'Rate' might they be talking about? See: "Interest Rates". Give a 'brief history' of the 'Rate'. Why would the 'Federal Reserve' make such a 'policy move' at this time? Explain how this 'change' in policy might affect the economy? Also, Illustrate with the "AD & AS" Model, the "Money Market Model", and the "Gov't Securities Market Model" - see "Cautiously Optimistic Fed Holds Rates Fast" , and "Guide to the Gov't Securities Market". Review the 'latest' Economic Performance Indicators: FEDSTATS, Economic Indicators, Current Economic Data, and FedViews.


"Bull Market"
3)  Review the "Value of the Firm" Model and recall our class discussion of the "Stock Market & Interest Rates". Also, consider how important the 'control' of interest rates is to the conduct of Monetary Policy. In view of the above, explain how Chairman Ben Bernanke   and 'The Fed' can affect the 'Stock Market'? In addition, recall Burton Malkiel's "Wall Street Moves Main Street" and his explanation of how stock prices influence the real economy. Lastly, note the "three paths" of influence and explain how changes in 'stock prices' ("Wall Street") can affect the 'real economy' ("Main Street"). If you can use an 'instructional break' from your work, I suggest you devote a few minutes to listening to Michael Lewis talk about 'Wall Street and Main Street'- "The Big Short: An Interview",. & "The People Speak — Wall Street Owns the Country",.

"Economic Indicators"

4)  During a recession, 'Fiscal Policy' in the form of discretionary policy. For example, the current "Stimulus Package" and the proposed "American Colleges and Universities 'Stimulus' Package" can be used to supplement the built-in stabilizers and alter the level of aggregate expenditure in order to achieve 'potential output' - a full employment level of GDP in the 'short-run'- and have a favorable influence on the supply side in the 'long-run'. Briefly explain and illustrate with the "AD & AS Model" (consider both 'Demand Side' and 'Suppy Side') the 'likely effect' of a "Higher Education Stimulus Package" on our economy. In addition, briefly explain and illustrate with the "Loanable Funds Model", possible implications for 'interest rates'.Think: "Crowding-in" and "Crowding-out". For more on 'Fiscal Policy' see:  "Budget, Deficit and Debt Charts" , "Whitehouse Budget Briefing" ,  "The Federal Budget" . "Budget of the United States Government" , "Office of Management and Budget", "The Bureau of Public Debt" .


"Economists" &  "The Great Policy Debate"
5)  Sample the readings by Ellen H. Brown below. Briefly summarize her policy recommendations for 'financing the stimulus'. Do you agree or disagree with her recommendations? Explain.
" Student Loans: The Government Is Now Officially in the Banking Business ",
"Lessons From The Wizard Of Oz".
"A Radical Plan For Funding The New Deal".
"LessonsFrom the Japanese: Time to Stop Borrowing Money and Start Printing It".
"Revive Lincoln's Monetary Policy:....".


"Powder Keg"  & "Jobs"   &  "A Moral Economy"  &   "Work in the 21st Century"
6)  Looking for a 'Bonus'? Like to do some 'optional' work? Interested in knowing more about 'employment' and 'unemployment'? Accept the challenge and take a look at the 'human side of the labor market'. Your task is to assist the editor of the "Vista" in writing a 'Special Report on Jobs and the Economy'. She has requested that you survey the material below, draw on your previous study of the employment and unemployment, and compose an essay which she can utilize as background material for her special report.

" Dr. Econ talks Unemployment", Dr. Econ,"www.frbsf.org".
" Minimum Wage and the Human Commodity",John Buell, "CommonDreams.org".
"Down And Out Of Work: The High Cost Of Long-Term Unemployment", Laura Bassett, "HuffingtonPost.com".
"Soaring Unemployment in California", "GlobalReasearch.ca".
" 18 Million Jobs by 2012 ",Robert Pollin, "thenation.com".
" Even in a Recovery, Some Jobs Won't Return",  Justin Lahart, "Wall Street Journal"
"Out of Work in the US",, "RealNews.org".
" Growing Underclass",  ,Catherine Rampell "New York Times"
" Americans Want to Get Back to Work: Why Won't the Gov't Hire Them?", "Huffingtonpost.com".
" Farewell to Jobs",   Jill Fraser, "TomDispatch.com"
" For Ex-Offenders, Older Workers, Uneducated, Jobs Even Harder to Find", Halimah Abdullah, "McClatchy Newspapers".
" Jobless statistics overlook many", Sam Zuckerman, "SFGate.com".
" Major Trends in Employment: College Graduates Now Facing Higher Unemployment,....", "MyBudget360.com".
" Recession Finds Even Those With Jobs Losing Pay", Christopher Leonard, "HuffingtonPost.com"
" Franklin Delano Roosevelt: Speech at Madison Square Garden (October 31, 1936) ", "Miller Center of Public Affairs".
" Who Broke America's Job Machine?", Barry Lynn & P. Longman, "Washingtonmonthly.com".
" Millions of Unemployed Face Years Without Jobs ", Peter Goodman,"New York Times".
" At Closing Plant, Ordeal Included Heart Attacks", Michael Lou, "Nytimes.com".
" No Labor Market Recession For America's Affluent, Low-Wage Workers Hit Hardest" , "Center for Labor Market Studies".
"The Fear Of Full Employment",George Brockway, "Economists Can Be Bad for Your Health". ~$~
"Take a Ride on the Real Estate Roller Coaster"
"New Reality Show"
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