What is CDSs naked selling? Explain briefly the process and why it was an important concept during the Subprime Mortgage Crisis of $2007-2009.$

Provide one argument in favor of and one against the idea that the Fed was responsible for the housing price bubble of the mid$2000$s$.$

What two key factors trigger speculative attacks leading to currency crises in emerging market countries?

Explain two concepts of central bank independence. Is the Fed politically independent? Why do economists think central bank independence is important?

The bank you own has the following balance sheet:

$\backslash$table$[[$Assets$,$Liabilities$],[$Reserves$,$$$75$ million,Deposits,$$500$ million$],[$Loans$,$$$525$ million,Bank capital,$$100$ million$]]$

If the bank suffers a deposit outflow of $$50$ million with a required reserve ratio on deposits of $10\%,$ what actions should you take?

Suppose you are the manager of a bank whose $$100$ billion of assets have an average duration of four years and whose $$90$ billion of liabilities have an average duration of six years. Conduct a duration analysis for the bank, and show what will happen to the net worth of the bank if interest rates rise by $2$ percentage points. What actions could you take to reduce the bank's interest rate risk?