University of Phoenix Federal Reserve Monetary Policy Discussion Paper

Competency 3 – The Global Economy

Competency 2 – The Federal Reserve, Government, and the Economy

Part 2 Competency 2 – Reflection

Assignment Content

Reflection- This reflection activity is comprised of two sections collectively totaling a minimum of 500 words. Complete your reflections by responding to all prompts.

Federal Reserve

Analyze how changes in the Federal Reserve’s monetary policy affect at least 2 of the 4 components of GDP (e.g., consumption, investment, government spending, net exports). Justify your answer to the following question: Have the Federal Reserve’s countercyclical monetary policies been effective in moderating business cycle swings?

Government Intervention

Government interventions into markets can sometimes succeed, but sometimes they make the situation worse. Explore 2 examples of government intervention that did not work. Explain why the intervention made things worse and what could have been done differently to improve the situation. Support your analysis by including:

• What the situation was
• What the intervention sought to solve
• What happened
• What might have been done differently

Competency 3 – The Global Economy

Part 2 Competency 3 – Reflection

Reflection- This reflection activity is comprised of two sections collectively totaling a minimum of 500 words. Complete your reflections by responding to all prompts.

Exchange Across International Borders

The success of an economy in effectively employing the four factors of production determines how well that economy performs relative to its potential and relative to other economies.

Address the following:

• Evaluate non-monetary benefits that open trade has contributed to the world since the end of World War II.
• Provide at least 2 examples of the above benefits and explain why you believe each is important.
• Analyze how changes to U.S. trade and tariff policies affected U.S. trade with other nations.

Support your responses with recent (less than 2 years old) credible news sources.

The Global Role of the US Economy

Consider that some politicians, labor unions, and special interest groups argue that U.S. trade deficits are harmful to the economy, and nations that run large trade surpluses with the United States are benefiting from unfair trade practices and agreements. These parties support increasing tariffs on imports and eliminating or rewriting trade agreements.

Analyze 2 credible economists’ opinions on the effects of 2 of the following factors with respect to the total U.S. trade balance. Find 1 economist who is less concerned about trade deficits, who thinks they are less important, or that they mean something else is good (U.S. consumers have more disposable income for example). Then, find another economist who is more concerned (he or she may see a trade deficit as having adverse employment effects, for example). Weigh in their different perspectives, and state whether you agree or disagree with their assertions, providing the logic behind your thinking. The factors to analyze include:

• Tariffs
• Changing trade agreements
• Manipulating exchange rates