Respond to both of the following prompts:

1. The United States has been considered one of the strongest economies in the world for nearly a century now, with one of the highest standards of living in the world. However, within your lifetime there was a drop in economic well-being due to a massive recession stemming from a combination of a tremendous housing bubble coupled with a subprime lending scheme by some of the biggest banks, compounded by high personal debt domestically and globalization-based trade deficits causing a meltdown of the economy. We have recovered fairly well and as far as economic activity goes, we went beyond where we were before the recession, making it the strongest economy in history. However, things are never perfect and inflation, unemployment, and economic struggles come back in a cyclical manner. Based on the reading, what do you think are some steps that could be taken to bring the U.S. economy to its strongest position and curtail future recessions and economic meltdowns? Other than GDP, how else might you determine how strong an economy is?

2. Think of three food items that you eat on a regular basis. Find out what the price of those three products are today. Then, internet search to try to find out what the price of those three products were in 1998. What does this tell you about inflation for those products? Did any actually deflate in value? What might have caused this inflation or deflation? Also, try looking up the average salary in 1998 versus today. What differences do you see there? Is the inflation consistent with the salary increases or does one outpace the other?