Scenario

Jamie picks Wanda up from the mall. When Wanda gets into the car, Jamie has the radio tuned to Public Radio. When Wanda reaches to change the station, Jamie stops her, explaining that she is listening to a report about a meeting of the Federal Reserve earlier that day. The reporter is talking about how the Federal Reserve is considering a potential increase in interest rates. Several economists are giving their opinions regarding the announcement. When the segment ends, Jamie changes the station. After thinking about what she has heard, Wanda asks Jamie, “Why do you and I care what the Federal Reserve does?”

For Discussion

  • In this discussion forum, you need to answer Wanda’s question. When putting together your response, consider the possible impact that increases/decreases in interest rates and the tightening/loosening of the money supply might have on Salty Pawz. Moreover, how might such decisions affect Wanda personally and as a business owner?

After considering the impact of the actions of the Federal Reserve on Wanda and Salty Pawz, do you believe that the decisions of the Federal Reserve affect you? If so, in what ways might you experience this impact? If you do not believe the actions of the Federal Reserve affect you, then why not?