Assignment Directions
Assume the role of a business consultant helping interns understand the finer points of economics. You have been tasked with developing a report
comprised of two parts. The goal of your report is to help the interns focus on real world application highlighting corrective actions by the Federal
Reserve and a government intervention program during the time of crisis.
Create an analysis incorporating the following:
Part 1: Federal Reserve
Choose 1 of the following topics related to the Great Recession:
• The housing price bubble, collapse, foreclosures, bailout of underwater mortgages
• Subprime mortgages and derivatives, bailout of FNMA, Freddie Mac, and AIG
• The banking industry crisis, bailout of commercial and investment banks
Write a 500- to 750-word analysis (Part 1 of your report) of 1 of the following corrective actions taken by the Federal Reserve as a result of the
crisis:
• Quantitative easing
• Purchase of toxic assets from financial institutions
• Paying interest on reserve balances
Address the following in your analysis:
• Actions taken by the Federal Reserve to mitigate the crisis
• How the corrective action helped to restore stability to the financial system and how it should prevent recurrence of a similar crisis
