Analyzing the Impact of Fiscal Policy Through Aggregate Demand and Supply Models

November 30, 2024November 30, 2024 Discipline: Economics

In this project, you will use the Aggregate Demand and Supply (AD-AS) model to analyze the effects of fiscal policy on an economy currently at equilibrium. You will represent the equilibrium through an AD-AS graph and introduce a new aggregate demand curve reflecting a temporary fiscal policy change.  

Instructions

  1. Choose an Economy or Hypothetical Scenario: Select a real-world economy currently at equilibrium or create a hypothetical scenario that allows for meaningful analysis.
  2. Fiscal Policy: Identify a temporary fiscal policy change, such as an increase in government spending or a tax cut. Research and determine how this change will affect the economy’s aggregate demand.
  3. Write Your Analytical Report: Compose a report (1000-1500 words) detailing the following. Include proper APA citations for all sources and data used. Review the APA Citation TipsLinks to an external site. document for more information. Your report should include:
    • Introduction: Outline the chosen economy or scenario and the focus of your analysis.
    • Provide an Aggregate Demand and Supply Graph: Using Microsoft Paint or Artboard on Mac, create a well-labeled AD-AS graph representing the initial equilibrium, labeling the positions of the AD and AS curves, and explaining the associated output and price level. 
    • Fiscal Policy Changes: Clearly state the objectives of the implemented fiscal policy, detailing whether it involves an increase in government spending or a tax cut. Justify your choice and provide relevant data. 
    • AD-AS Graph Update: Introduce the new aggregate demand curve resulting from the fiscal policy change.
      • The New Equilibria:
        • Short Run Equilibrium: Identify and explain the new short run equilibrium point on the AD-AS graph.
        • Long Run Equilibrium: Identify and explain how the economy might move to a new long run equilibrium.
    • Analysis: Discuss the impact of the fiscal policy on the economy using the AD-AS model.
    • Evaluation: Provide a critical assessment of the policy’s success or failure in meeting its objectives, considering potential limitations, side effects, or unintended consequences. 
    • Conclusion: Summarize your key findings, insights, and implications.

Your project will be assessed based on the following criteria:

  • Depth of Analysis and Interpretation: The complexity and thoroughness of your analysis using the AD-AS model.
  • Critical Evaluation: Your ability to critically evaluate the efficacy of the fiscal policy.
  • Coherence and Logical Flow: The structure and flow of your report.
  • Graphical Representation: Clarity and correctness of the AD-AS graph.
  • Writing Skills: Proficiency in grammar, language usage, and academic writing style.
  • Adherence to Guidelines: Compliance with project instructions and ethical considerations.

Are you struggling with your paper? Let us handle it - WE ARE EXPERTS!

Whatever paper you need - we will help you write it

Get started

Starts at $9 /page

Login Register Reset

How our paper writing service works

It's very simple!

  • Fill out the order form

    Complete the order form by providing as much information as possible, and then click the submit button.

  • Choose writer

    Select your preferred writer for the project, or let us assign the best writer for you.

  • Add funds

    Allocate funds to your wallet. You can release these funds to the writer incrementally, after each section is completed and meets your expected quality.

  • Ready

    Download the finished work. Review the paper and request free edits if needed. Optionally, rate the writer and leave a review.

Place order now