Economic Problems



Monetary Policy – The Problem

INSTRUCTIONS: Follow the steps below to complete the activity.

• Using all of the terms listed below you need to create a fictional story or a comic.

• The story must present an economic problem (Examples – A contraction/recession, rapid inflation, bank failure/credit unavailable, high unemployment, or anything else you can think of).

• The problem must explain what has happened to the economy and the people in your story as a result of the above stated problem.

• Your story needs to include fictional characters who are involved with the problem.

• You must use all of the following terms in a way that explains what the term (Underline the terms as you go).

TERMS

• The Federal Reserve Bank

• Ben Bernanke (Head of the Federal Reserve)

• Monetary Policy

• Money Supply

• Tight Monetary Policy

• Loose Monetary Policy

• Reserve Requirements

• Discount Rate

• Federal Funds Rate

• Open Market Operations

Monetary Policy – The Fix

INSTRUCTIONS: Now that you have yourself in a bind, complete the steps below to help solve your economic problem.

• Using all of the terms below, write part 2 of your story – Fixing the economic problem.

• Your problem must explain how the Federal Reserve will use its tools to correct the economic problem you created in part 1.

• Everyone in the story should live happily ever after.

• You must underline the terms when you use them and be sure you use them in a way that help’s explain them.

TERMS

• Ben Bernanke

• The Federal Reserve

• Monetary Policy

• Federal Open Market Committee

• Money Supply

• Tight Monetary Policy

• Loose Monetary Policy

• Reserve Requirements

• Discount Rate

• Federal Funds Rate

• Open-Market Operations

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