1. If you lived in a village cut off from the rest of the world, show how Say's law would apply to your village's economy.
2. If you had a job as a financial counselor and a bad recession hit, what advice would you give your clients to enable them to keep their heads above water?
3. Using the AD/AS diagram possibilities, explain which diagram explains the scenarios and why that is the diagram that fits the scenario best:
U.S. Federal Reserve allows money supply to fall during 1930s
Federal spending increased during World War II
Investment tax credits of 1960s
Oil price increases of 1970s
4. Using the Keynesian aggregate expenditure model, sketch the diagram corresponding to the following historical events and explain their importance:
· Tax increases of 1990s
· Vietnam War spending of 1960s-1970s
· Tax cuts of 2000s
PART II: JOURNAL ACTIVITY
Journal Activity: Macroeconomics Opinion Project
Directions: Some say the government over spends. Others feel the government must become more financially savvy. Consider the development of the United States economy and the challenges the government has faced over the past decade (bailouts, fiscal cliff, etc.). Do you agree with the theory that the government must make changes in order to survive? In a 5-page minimum APA formatted paper, evaluate your thoughts on what the role the government plays financially.
You will be expected to include real-world examples to back up your analysis. You may include topics such as the Great Depression, World Wars, and various decades to give merit to your response.
There is not a right or wrong answer to this assignment as you are describing which theory you agree with. Just be sure to thoroughly back up your topic with the use of solid examples. Wikipedia will not be counted as a valid reference for this paper.
Your paper must follow APA format with a title and reference page (not included in the page count) double-spaced and indented paragraphs, and proper in-text citations.
Note: You may utilize LIRN to help you locate resources. Please visit the Academic Resource Center for guidelines on using LIRN and APA format.