Problem
I. How effectively has the Federal Reserve used monetary policy over the past decade to achieve its goals of price stability and maximum employment? (Relevant inflation and unemployment rates are required as part of a sufficient answer. These rates can be found in the Week 7 module by selecting "FRED Website: Inflation (CPI-U)". "BEA Website: Inflation (PCEPI)", and "BLS Website: Unemployment". For CPI-U inflation rates, choose "10Y" for the time period. Note that you can read the precise rates on the CPI-U graph by placing your cursor on the graph lines for the CPI-U and CPI-U core rates. The PCEPI rates are provided in the BEA chart for a period of one year from the stated month. For unemployment rates, under "Employment" check the box "Unemployment Rate (Seasonally Adjusted)", then scroll down to click on the box "Retrieve data". Once the data is retrieved, set your "From:" and "To:" years to cover the past decade.)
II. What are some of the variables influencing price stability and employment that are largely beyond the Fed's control? (Examples include such variables as supply shocks, fiscal policy, the pandemic, etc.)
III. Would it be preferable for the Fed to operate with a single mandate of price stability instead of its current dual mandate? (Your answer should consider the implications for achieving both price stability and full employment.)