1. Make the case for monetary policymakers being bound by policy rules. Why would it be advantageous, and why would it be problematic? In what ways is policy discretion preferable, and problematic? How does this illuminate the current debate of requiring the Fed to adopt a Taylor rule? Explain.
2. Choose two of the "lessons" of monetary policy discussed at the end of chapter 25. Illustrate and explain the lessons, and discuss how the lessons either reinforced or clarified your existing knowledge of the role of monetary policy coming into this course.
3. How has China used a pegged currency to its advantage? What are the pros and cons of this policy for China? How has this approach evolved more recently? Explain, and use graphs of the market for foreign exchange to illustrate.