Assignment 2: The Economy, Monetary Policy, and MonopoliesDue Week 8 and worth 200 pointsWrite a...

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Assignment 2: The Economy, Monetary Policy, and Monopolies
Due Week 8 and worth 200 points
Write a three to four (3-4) page paper in which you:
1. Analyze the current economic situation in the U.S. as compared to five (5) years ago. Include
interest rates, inflation, and unemployment in your analysis.
2. Propose two (2) strategies that the federal government could implement that would encourage
people to spend more money in order to create employment opportunities.
3. Identify a situation in the past 50 years in which the government used antitrust policies to stop a
monopoly from occurring. Include the circumstances of the proposed monopoly and the reason
the government stepped in. Predict what would have occurred had the monopoly succeeded.
4. Propose two (2) methods of identifying groups of customers who should receive a discount for a
product or service without alienating consumers.
5. Suggest three (3) reasons a monopoly may or may not be efficient in any economy.
6. Use at least three (3) quality resources in this assignment.
Your assignment must follow these formatting requirements:
? Be typed, double spaced, using Times New Roman font (size 12), with one-inch margins on all
sides; references must follow APA or school-specific format. Check with your professor for any
additional instructions.
? Include a cover page containing the title of the assignment, the student’s name, the professor’s
name, the course title, and the date. The cover page and the reference page are not included in
the required page length.
The specific course learning outcomes associated with this assignment are:
? Analyze imperfectly competitive markets – monopoly, monopolistic competition and oligopoly – to
understand their profit-maximizing decisions.
? Explain the factors and mechanisms of growth.
? Explain how governments use monetary and fiscal policy to manage the economy.
? Use technology and information resources to research issues in principles of economics.
? Write clearly and concisely about principles of economics using proper writing mechanics

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David · Accepted Answer

Q1. Analyze the current economic situation in the U.S. as compared to five (5) years ago. Include interest rates, inflation, and unemployment in your analysis. 
Answer:
Currently U.S is attempting to recover from the recession that hit it in 2008. In these 5 years the unemployment rate exceeded 9%, and remains at 8.5% even today. Prices have been stable at around 2%. GDP growth is still weak and reflects sluggish Federal spending and inventory demand. Some positives include rise in housing demand, consumption and capital spending. The Government has been following a loose monetary policy keeping money supply easy and interest rates low, hoping that investments will be encouraged by this.  Interest rates are the lowest in history by some estimates and FED has consistently worked to maintain this low level and easy liquidity in the system. The biggest concern is the persistent high unemployment rate. 
Q2 Consumption depends on the spending ability and the desire to buy
Answer:
The government can work on both these issues to spur consumption demand.
· It can lower taxes so that disposable income rises accordingly. 
· It can also provide more benefits at the work place which increases the real income in terms of well being achieved with old levels of income. One example is child care benefits, in terms of a child centre in offices. it can also allow flexi timing for employees in a proper institutional way so that moms are encouraged to work from home rather than drop out of work force. Such work from home options contributes to consumption spending.
· Consumer sentiment about the economy can be improved with some difficult decisions taken that promote long term benefits. This will infuse confidence in the government and its intentions, which will encourage people to be positive about the future and their job security as a rising economy means lower unemployment.

Assignment 2: The Economy, Monetary Policy, and Monopolies Due Week 8 and worth 200 points Write a three to four (3-4) page paper in which you: 1. Analyze the current economic situation in the U.S. as...

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