a. Recently the cost of steel has been rising and so has the value of the dollar. What will be the impact of these trends on the three big auto manufacturers in the US. Which of the two trends are detrimental to these companies' profitability abroad? What should they do to minimize the effect of these trends?

b. During the recent recession in RomulanLand, the government which was already running on deficit decided to undertake a massive project to build high-speed rail network across the country. Why would the government add on such high level of spending to its budget when it is already running a fiscal deficit? (Hint: use of proper financial / economic terms is key to getting full credit.)