Macroeconomics Analysis

10) The estimated natural rate of unemploymentreal GDP level is approximately $14 trillion and the current real GDP is approximately $12.5 trillion. In the current political mood in the U.S. there has been increased discussion on implementing a middle class tax cut as one policy option to stimulate the economy. Given this policy initiative and the marginal savings rate for U.S. households which is approximately 5.5% compute and upload to Dropbox a diagram illustrating the estimated value of a middle class tax cut that would be necessary to eliminate the recessionary gap.