ECO 372 Week 4

Individual Federal Reserve Presentation

Your boss has chosen you to give a presentation to a number of foreign officials regarding the United States Federal Reserve System. These officials are very interested in doing business in the United States, but they would like to learn more about the Federal Reserve and how it operates.

Develop a 10- to 15-slide Microsoft PowerPoint presentation.

Address the following questions and include a notes page which contains the write-up portion to each question:

What are the factors that would influence the Federal Reserve in adjusting the discount rate?

How does the discount rate affect the decisions of banks in setting their specific interest rates?

How does monetary policy aim to avoid inflation?

How does monetary policy control the money supply?

How does a stimulus program (through the money multiplier) affect the money supply?

Currently, what indictors are evident that there is too much or too little money within the economy? How is monetary policy aiming to adjust this?

Discussion Questions

How does a government budget deficit affect the economy? Identify two periods in recent history in which the United States has run budget deficits. What were the reasons for the deficits during those time periods?

How does a government budget surplus affect the U.S. economy? Identify two periods in recent history in which the United States has run budget surpluses. What were the reasons for the surpluses during those time periods?

What are the potential consequences of a country having a large overall debt? If you were in the position to implement a solution for the countrys long-term debt, what would it be and why?

What are the positive and negative aspects of budget deficits and surpluses? What policy is best for todays economy? Explain your answer.