Extra Credit Option 1.How does the changing behavior of creditors influence the shape of the yield curve and the risk premium during financial crises? How and why do these changes in the yield curve impact aggregate supply and demand? Please explain your answers in words (no need for graphing).

Extra Credit Option 2. What can a central bank do to offset the impact of the changing shape of the yield curve and changing risk premium during financial crises? You can answer this question in theory (based on the model outlined in the textbook) or historically, by describing the Fed's actions on this front during the global financial crisis in 2008-9.

Extra Credit Option 3. Imagine that you are designing a central bank. What information would you need about your economy, polity, and society to determine whether your bank should have an inflation target or an output target?

Extra Credit Option 4.Do information asymmetries increase more during a recession caused by a pandemic or a financial crisis? Explain why one of these cases is worse than the other, then describe how the increasing information asymmetries influence the AS-AD economy and what a central bank can do about it.

You can choose at least two problems and solve it.