The Economy, Monetary Policy and Monopolies - Essay Example

For instance, in 2007 the interest rate was recorded to be approximately 5% which decreased to below 1% by the end of 2009. Since then, till the current phase of the economic conditions prevailing within United States the interest rates has been recorded below 0.5% which shows further decline in the country’s financial market (US Department of the Treasury, 2012). Inflation Rates Fig.2: US Inflation Rates 2002-2012 (US Inflation Calculator, 2012) The inflation rates of the United States which was recorded as 4.

1% during the year 2007 which further declined to 0.1% by the year 2008. However, it augmented to an average of 2% within the period of 2009 to 2012. This indicates that in terms of inflation rates the economy is regaining its stability performing almost similarly as during the period prior to 2007 (US Inflation Calculator, 2012). Unemployment Rates Fig.3: US Unemployment Rates 2007-2012 (U.S. Bureau of Labor Statistics, 2012) In relation to the above represented statistics, it can be observed that United States witnessed an unemployment rate between 4-5% during 2007-2008.

This further augmented to above 8% by 2012. This indicates that the economy had been witnessing a continuous de-gradation of its employment situation in the labor market over the past five years (U.S. Bureau of Labor Statistics, 2012). 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. Financial Leverage Financial leverage can be considered as one of the effective sets of practices in which the Return on Equity (RoE) is increased through the escalating rate of debt amounts.

With this concern, the federal government of the U.S. should be focused on magnifying the amount of RoE even in situations when debt amounts tend to be increasing. Therefore, the financial strategy of the federal government should consider the investable assets related to the amount of equity as it would promote financial growth (Financial Literacy and Education Commission, 2011). Financial Decision Making and Financial Literacy Strategies related to the augmentation of financial literacy and effective decision making process would further provide competent direction in relation to financial education, policy, research, practice as well as coordination among the stakeholders, investors and other financial institutions.

Moreover, effective forms of financial education and decision making process would offer the benefits of evaluating the risk of interest rates and provide an effective way to trim down the debt amounts (Financial Literacy and Education Commission, 2011). 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.

Various antitrust policies have been implemented by the US government over the past decades to prohibit unhealthy competition in terms of monopoly within its national business environment. One of such Act can be identified as the National Cooperative Research Act of 1984 (15 U.S.C. § § 4301-05). The reason behind implementing this act can be