The year is 2035, and the American economy is going through its most serious recession in over
Question:
The year is 2035, and the American economy is going through its most serious recession in over 25 years. Gross domestic product is falling, while inflation and unemployment are both rising. At the same time, the national debt is approaching $50 trillion. In order to help understand and eventually solve this crisis, you need to address the following (point values in parentheses):
1. Describe the possible reasons for the rise of unemployment, and analyze some possible strategies that the government could use to help employment recover. (5)
2. Explain the three major possible causes of inflation, and analyze when inflation is high enough that it should be considered a serious problem. Then discuss who benefits the most and who suffers the most during a period of high inflation. Finally, discuss what the government can do to try to help combat high inflation. (5)
3. Provide a detailed argument for whether a policy of free trade or protectionism would be more effective at helping the country break out of this economic crisis. (5)
4. Explain what, if anything, you would do to address the nearly $50 trillion national debt and why. (5)
Income Tax Fundamentals 2013
ISBN: 9781285586618
31st Edition
Authors: Gerald E. Whittenburg, Martha Altus Buller, Steven L Gill