Comp 2 Part 1 Choose 1 of the following topics related to the Great Recession: The housing price bubble, collapse, foreclosures, bailout of underwater mortgagesSubprime mortgages and derivatives, b

ECOCB/535 Competency 2 Assessment and Rubric

Course Title: The Digital Economy

Competency Assessment Title: Corrective Actions: The Federal Reserve and Government Intervention Programs

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

Note: Use of charts and graphs is encouraged, with appropriate citations. Any charts or graphs retrieved from the Federal Reserve Bank of St. Louis FRED website may only be included when the data sources used by FRED are U.S. government sources, such as the Bureau of Economic Analysis or the Bureau of Labor Statistics.

Cite at least 2 academically credible sources.

Part 2: Government Intervention Program

Review the Competency 2 Resources: The Roles of Government in the Economy.

Analyze 1 of the following government intervention programs:

Counter cyclical fiscal policies (countering economic disruptions such as the housing bubble and the Great Recession) • U.S. agriculture support programs
Assistance for low Income families (choose 1):
- Housing vouchers o Earned Income Tax Credit (including Child Tax Credit) o Supplemental Nutrition Assistance Program (SNAP)
Low-income health care (choose 1):
- Medicaid (including Children's Health Insurance Program). o Affordable Care Act expansion
Social insurance programs (choose 1):
- Old Age, Survivors, and Disability Insurance (OASDI) o Medicare
- Unemployment insurance

Now that you have identified a government intervention and the market failure leading up to this intervention you are ready to continue moving forward.

Write a 750- to 1,050-word summary of your analysis (Part 2 of your report) in which you address the following:

Analyze the arguments for government intervention versus those for market-based solutions. Hint: See the information about market failures.
Examine who has been helped and who has been hurt by the selected government intervention.
Examine externalities and unintended consequences of the intervention.
Explain whether the cost of the intervention you selected, as a share of GDP or the number of participants, is increasing, decreasing, or varying with the state of the economy. Your analysis should be based on the cost trend (or number of participants) since 2000 or since its inception if after 2000.
Analyze credible economists’ opinions on the success or failure of the intervention in achieving its objectives.
Recommend whether the program should be continued as is, discontinued, or modified based on your conclusions. Defend your recommendation.

Note: Use of charts and graphs is encouraged with appropriate citations. Any charts or graphs retrieved from the Federal Reserve Bank of St. Louis FRED website may only be included when the data sources used by FRED are U.S. government sources such as the Bureau of Economic Analysis or the Bureau of Labor Statistics.

Cite at least 2 academically credible sources.

Compile Parts 1 and 2 into one report.

Submit your report.

Competency Assessment Rubric

Assignment/Performance Criteria	Mastery 100%	Meets Expectations 85%	Not Met 0%
1. Pt. 1 – Federal Reserve: Mitigating the Crisis (weight 12%)	Thoroughly analyzed the actions taken by the Federal Reserve to mitigate the chosen crisis.	Partially analyzed the actions taken by the Federal Reserve to mitigate the chosen crisis.	Narrowly analyzed the actions taken by the Federal Reserve to mitigate the chosen crisis or no attempt was made to analyze the actions taken by the Federal Reserve to mitigate the chosen crisis.
2. Pt 1– Corrective Actions (weight 14%)	Thoroughly analyzed how the corrective action helped to restore stability to the financial system for the chosen crisis and how it should prevent recurrence of a similar crisis.	Partially analyzed how the corrective action helped to restore stability to the financial system for the chosen crisis and how it should prevent recurrence of a similar crisis.	Narrowly analyzed how the corrective action helped to restore stability to the financial system for the chosen crisis and how it should prevent recurrence of a similar crisis or no attempt was made to analyze how the corrective action helped to restore stability to the financial system for the chosen crisis and how it should prevent recurrence of a similar crisis.
3. Pt. 2 – Government Intervention: Argument (weight 12%)	Thoroughly analyzed the arguments for government intervention.	Partially analyzed the arguments for government intervention.	Narrowly analyzed the arguments for government intervention or no analysis was made.
4. Pt 2 – Government Intervention: Helped and Hurt (weight 12%)	Thoroughly examined who has been helped and hurt by the intervention program.	Partially examined who has been helped and hurt by the intervention program.	Narrowly examined who has been helped and hurt by the intervention program or no attempt to examine who has been helped and hurt by the intervention program selected was made.
5. Pt 2 – Externalities and Consequences (weight 12%)	Thoroughly examined externalities and unintended consequences of the selected intervention.	Partially examined externalities and unintended consequences of the selected intervention.	Narrowly examined externalities and unintended consequences of the selected intervention or no attempt to examine externalities and unintended consequences of the selected intervention was made.
Assignment/Performance Criteria	Mastery 100%	Meets Expectations 85%	Not Met 0%
6. Pt 2 – Cost of Intervention (weight 12%)	Thoroughly analyzed whether cost of the intervention selected as a share of GDP or the number of participants had increased, decreased, or varied with the state of the economy, based on the cost trend (or number of participants) since its inception or since 2000.	Partially analyzed whether cost of the intervention selected as a share of GDP or the number of participants had increased, decreased, or varied with the state of the economy, based on the cost trend (or number of participants) since its inception or since 2000.	Narrowly analyzed or no attempt was made to analyze whether cost of the intervention selected as a share of GDP or the number of participants had increased, decreased, or varied with the state of the economy, based on the cost trend (or number of participants) since its inception or since 2000.
7. Pt 2 – Economists’ Opinions (weight 12%)	Thoroughly analyzed credible economists’ opinions on the success or failure of the intervention chosen in achieving its objectives from a creative and innovative perspective.	Partially analyzed credible economists’ opinions on the success or failure of the intervention chosen in achieving its objectives.	Narrowly analyzed or no attempt was made to analyze credible economists’ opinions on the success or failure of the intervention chosen in achieving its objectives.
8. Pt 2 – Recommendation (weight 14%)	Thoroughly defended recommendation about whether the program should be continued as is, discontinued, or modified in a creative and insightful way.	Partially defended recommendation about whether the program should be continued as is, discontinued, or modified.	Narrowly defended recommendation about whether the program should be continued as is, discontinued, or modified or no attempt to make a recommendation or did not defend recommendation about whether the program should be continued as is, discontinued, or modified was made.