1a. Discuss the pros and cons of central banks setting policy based on rules as opposed to setting policy based upon the discretion of policymakers at each policy meeting.

(b) Review the money-growth rules discussed in Chapter 18 to determine which rule you believe is the most viable. Explain your rationale.

(c) Argue for or against using the Taylor Rule to guide economic policy. Provide specific examples to support your response.

(d) Determine the impact on the economy if the central bank in the U.S. used inflation targeting. Explain your rationale.

2a. Step into the shoes of a financial analyst. Discuss which steps of the capital budgeting process you would find the most challenging and state why.

(b)Discuss the pros and cons of applying different investment decision rules when faced with the choice of investing corporate funds. Provide at least two examples.

(c) Analyze the guidelines for financing strategy to determine which element would be the most valuable to the greatest number of businesses.

(d) Describe a business with which you are familiar to determine the key steps that the business could take in order to reduce its cost of capital.