Explain economically what caused the housing crisis and how this crisis led to the 2007-2009 recession. Critically evaluate, using economic concepts, the federal government’s response to the recession. What changes in policy would you recommend for the future? Explain your recommendations using economic concepts. WA #8 Using everything you have learned so far in this course, describe thoroughly, the best environmental and energy policies for the US to enact over the next 5-10 years in order to reduce the carbon footprint of energy production and consumption. Assume that the government is NOT in the business of picking winners and losers among energy sources (oil, natural gas, solar, wind, etc). What I’m asking for is broad economic policy (regulations, taxes, subsidies, tradable vouchers, etc). Explain what economic tools you would use and how you would implement them and then rationalize your choice by explaining the economic implications of each part of your policy and why these policies are “optimal” in your view. WA # 9 How could you use marginal benefit and marginal cost analysis to determine whether money would be better spent keeping prisoners incarcerated or on employing more police? Explain why marginal analysis is the best way for governments to determine the optimal allocation of public money between the various ways they have to influence criminal activity. WA # 10 Use what you have learned about price controls on agricultural commodities to predict what will happen in the rental apartment market if local governments (like NYC, Berkley and San Francisco) establish price controls (price ceilings) on rental apartments in their cities. Be as thorough as you can by including as many secondary impacts as you can (impact in markets other than rental apartments).
