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ECO 203 Week 5 Final Paper The Future 

Of The Economy

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ECO 203 Week 3 Fed And Its Tools

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ECO 203 Week 5 DQ 2

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ECO 203 Week 5 DQ 2

Between October 2004 and 2005, real GDP in the 

United States increased by 3.6 percent, while nonfarm 

payroll jobs increased by only 1.4 percent. How is it 

possible for output to increase without a proportional 

increase in the number of workers? What are the 

implications in our economy of more output being 

produced by less workers?

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ECO 203 Week 5 DQ 1

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ECO 203 Week 5 DQ 1

Some states are required to balance their budgets. Is 

this measure stabilizing or destabilizing? Suppose all 

states were committed to a balanced budget philosophy 

and the economy moved into a recession. What effects 

would this philosophy have on the size of the federal 

deficit?

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ECO 203 Week 4 DQ 2

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ECO 203 Week 4 DQ 2

On pg. 255 in your text, The Economics in Practice 

describes the increase in food prices around the world in 

2008. Since food, in large measure, affects the real income 

of households, increasing prices will eventually push up 

wages and have an impact on the aggregate supply curve. 

Central banks were very worried about the prospects for 

inflation becoming generalized. To stop inflation, what 

would the Fed be likely to do? What are the consequences 

for the economy? Specifically, what would be the effects on 

employment and unemployment given the actions taken by 

the Fed?

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ECO 203 Week 4 DQ 1

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ECO 203 Week 4 DQ 1

Your boss offers you a wage increase of 10 percent. 

Is it possible that you are worse off with the wage 

increase than you were before? Explain your answer 

using proper economic terms and analysis.

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ECO 203 Week 3 DQ 2

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ECO 203 Week 3 DQ 2

Why do you think the FED evaluates the money multiplier when 

making decisions with regard to the money supply? What 

function does the money supply serve in our economy to 

influence certain economic variables? Why does the FED like to 

fight inflation in our economy and is inflation a concern right 

now given our current economic situation?

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ECO 203 Week 3 DQ 1

While many thought that the 2008 fiscal stimulus plan 

described in the feature on pg. 174 was a good idea, 

some did not. Some even thought that Congress didn’t 

go far enough. In retrospect, who was right? Did the 

economy experience a recession in 2008 or 2009? What 

happened to employment during the rest of 2008? What 

are some of the alternatives to a tax cut that might 

have been used?

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