Download Naked Economics Chapter 10: The Federal Reserve

Chapter 7:Financial Markets:
What economics can tell us about getting rich quick (and losing
weight too!)
1. What are the four basic needs all financial instruments are based upon?
2. How do we spend large sums of money that don’t belong to us?
3. What do financial markets do other than take capital from the rich and lend it out
to everyone else?
4. How do financial markets insure against risk? Provide an example.
5. What is the key difference between Brokerage houses and Las Vegas hotel
casinos in terms of the zero sum games?
6. What do financial markets do for capital that other markets do for everything
else?
7. Why doesn’t everyone get rich in the market?
8. What is the main premise of the efficient markets theory?
9. What does the field of behavioral economics say humans are prone to?
10. What are the basic set of rules to which any decent investment advice must
conform?
Naked Economics Chapter 10: The Federal Reserve:
Why that dollar in your pocket is more that just paper
1. Why was it important for the FED to be open for business after the attack on
September 11, 2001?
2. What is the main job of the FED?
3. Some economists argue that faulty monetary policies caused the Great
Depression, why did they say that and give examples to prove that point?
4. What are the causes of low inflation?
5. What is the power of the FMOC and who is its Chairman?
6. What is the difference between money and wealth?
7. What are mediums of exchange?
8. What are some of the negative effects to our economy from inflation?
9. Why is deflation worse than inflation and give an example of why this is true?