Question

What do current economic data tell us about the health of the economy? Assess the current health of the U.S. economy by evaluating the key economic indicators that we have looked at in this course. How close is the overall economy to potential GDP and the natural rate of unemployment? The relevant economics statistics include the growth rate of real GDP, the unemployment rate, and the inflation rate at a minimum. You are encouraged to discuss and evaluate other economic indicators that could add to a more complete picture of the current state of the economy.

Since the trough of the last recession in 2009 the United States has experienced one of the longest business cycle expansions on record although until recently the upswing has been characterized by relatively low rates of economic growth. Outline and explain two macroeconomic issues/challenges facing the United States that could possibly move the economy away from full-employment GDP and create a recessionary gap? You may want to consider the challenges posed by the growing budget and trade deficits that are discussed in your text. Utilize the GDP equation (GDP=C+I+G+X-M) as the framework for crafting your answer.

Globalization has pulled hundreds of millions of people out of poverty in China and India and other countries in Asia. Global equality appears to be increasing through the principle of “comparative advantage” as discussed in Chapters 10 and 20. How should the convergence of global incomes be weighed against the structural changes that globalization has required in the United States and other developed economies? Should the Trump administration abandon plans to renegotiate or cancel the North American Free Trade Agreement (NAFTA) and other trade deals given the potential negative effects on incomes in other countries? Why or why not? Should workers who lose their jobs due to foreign imports be compensated for their lost incomes? Explain your reasoning utilizing the concepts introduced in Chapters 10, 20, and 21 of your digital text.

The Council of Economic Advisers requests that you carefully describe and explain at least two long run macro policy options that the President can consider to boost productivity growth and potential GDP. Discuss which perspective was more useful in developing your two policy options: the Keynesian Perspective or the Neoclassical Perspective? Utilize the AD/AS framework in framing your answer.