Introduction For the benefit of the incoming administration, I submit this report to document, analyze, and interpret the macroeconomic policy decisions I made as the chief economic policy advisor of Econland. The purpose of this document is to further our national prosperity by deepening our understanding of the relationship between macroeconomic policies and their consequences for our citizens. The report includes a thorough accounting of the major fiscal and monetary policy decisions made over each of the seven years of my term, as well as an explanation of the underlying rationales for those decisions and the resulting impacts of those policies. Table 3: Economic Environment, Decisions, and Results Year 0 Year 1 Year 2 Year 3 Year 4 Year 5 Year 6 Year 7 0.2 1.6 24 24 1.6 0 8 0.4 Global Economic Growth Forecast 93.1 103.4 100.0 100.0 103.3 100.5 37.8 100.3 Consumer Confidence Index 2 0 2.0 2.0 3.0 3.0 3.0 Interest Rate % 24.0 240 24 0 10 20.0 8 0 18.0 18.0 Income Tax Rate % 25.0 23.0 20.0 15.0 15.0 30.0 30.0 30.0 Corporate Tax Rate % 30.0 30.0 20.0 25.0 25.0 30.0 30.0 20.0 Government Expenditure US$ (in billions) D.9 11.7 25 3.6 5.8 Real GDP Growth % 3.9 2.0 50 5.2 79 5.9 Unemployment Rate % 7.8 47 2.0 20 2 2 16 16 Inflation Rate % 1 2 4.2 0.8 0.3 -0.3 -30 -2 Budget Surplus (Deficit) as % of GDP Table 1.1 The graph above shows the macroeconomic climate of Econland over seven years using the "roller coaster" simulation. With the last year adjustments, there was an approval rate of 73 If you notice that, once I lowered the interest rate, income tax rate, corporate rate percentage and the government expenditure, I was to maintain a steady consumer confidence index. It dropped slightly from the previous three years, but not to the point of drastic measures. In year seven, I maintained everything low, but raised the government expenditure back to the average and was able to peak consumer confidence back to its highest level. Fiscal Policy: Taxationsnhu Year 7 Results Table 1: Real GDP and Its Components Year 0 Year 1 Year 2 Year 3 Year 4 Year 5 Year 6 Year 7 Consumption 55.0 59.1 63.7 70.4 83.0 99.5 103.3 121.9 Government Expenditure 30.0 30.0 35.0 30.0 20.0 25.0 25.0 30.0 Investment 15.0 15.2 16.4 17.4 18.6 18.3 18.7 23.6 Exports 25.0 25.6 26.5 27.3 28.1 28.8 30.0 31.6 Imports 25.0 26.9 28.8 31.4 36 3 2.3 42.1 17.9 Nominal GDP 100.0 103.0 112.8 113.7 113.3 129.3 135.0 159.2 Real GDP 100.0 101.0 109.5 105.0 102.3 121.6 118.3 130.7 Table 2.1 [Insert your responses to the following: Explain the intent of the taxation policy decisions you made of your seven-year term. What were the macroeconomic principles or models that influenced your decision making?] [Identify the impact of your changes to the income and corporate tax rates. How were consumption and investment affected by your tax policy decisions? Explain these dynamics using specific macroeconomic principles from the course reading.] [Compare and contrast the impact of your tax policy decisions with those of current or historical examples in the United States. What do these examples demonstrate about the validity of macroeconomic models? Be sure to cite your research appropriately.]Fiscal Policy: Government Expenditure Real GDP Growth Unemployment Rate High Low 14.0 - 10.0 10.0 - 8.0 - 6.0- 6.0 2.0 - 4.0 - % of labor force -2.0 - 2.0 - -6.0 0.0 - 0 1 2 3 4 5 6 7 0 1 2 3 4 5 6 7 Figure 3.1snhu Price Level Aggregate supply Equilibrium price level Aggregate demand Equilibrium Quantity of output Output Figure 3.2 If you looked at the first year, everything was neutral. The government was funded through tax collection. [Insert your responses to the following: Explain your decision making regarding government expenditure and how it changed based on the macroeconomic conditions. What was the intent of your fiscal policy decisions in response to the given economic climate?] [Evaluate your fiscal policy decisions, including how they impacted key macroeconomics factors such as real GDP growth and unemployment. To what extent did your policies yield positive or negative outcomes?] [Refer to the AD/AS model to support your analysis in this section of your report.]Inflation Rate Average 8.0 6.0 - 4.0 2.0 0.0 -2.0 2 3 4 5 snhu Figure 4.1 [Insert your responses to the following: Explain how you changed the interest rate levels and how these changes impacted other macroeconomic factors such as inflation, consumption, investments, GDP, and foreign trade. Provide specific examples to illustrate.] [Compare and contrast the impact of your monetary policies with those of current or historical examples in the United States. What do these examples demonstrate about the validity of macroeconomic models? Be sure to cite your research appropriately.]Global Context [Insert your responses to the following: Analyze the impacts of openness to trade in general. Why and how are the impacts of monetary and fiscal policies different in a closed economy versus an open economy? Support your claims with specific details from your course reading.] Conclusions [Insert your overall conclusions about the relevance and significance of macroeconomics. Assess the effectiveness of your economic policy decisions. Did your economic policy decisions produce the anticipated results? Did your macroeconomic principles and models behave in ways that you expected? Provide specific examples to illustrate.] [Evaluate how consumer confidence might have impacted the outcomes of your policy decisions for the economy of Econland. Why is consumer confidence a relevant factor for making informed macroeconomic decisions?] References Mankiw, N. G. (2021). Principles of economics (9th ed.). Cengage Learning. 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