Macroeconomic Problems

Paper Summary:

This paper explains five theoretical macroeconomic problems including (1) GDP growth is 1.5%, steady over two years, (2) inflation has been 1-2% for the last two years, (3) unemployment is at 7.3%, up from 7% the previous year and 6.5% the year before that, (4) federal funds rate target is 3.5% and the discount rate is 3.25% and (5) the government budget has been operating at a deficit of $60 billion from last year, up from $50 billion the previous year. The author stresses that, as with many other disciplines, in economics, there is not always a singular answer to a given problem.

From the Paper:

"The purpose of this paper is to present some possible solutions to problems in macroeconomics. As with many other disciplines, there is not always a singular answer to a given problem in the field. This is true of economics. Many theorists have spent many decades debating the veracity of their own claims. The Keynesians have gone toe-to-toe with the monetarists, for instance. With that in mind, it is important to understand that the focus of this paper is not on presenting absolute answers to the problems given, but instead to provide some possible solutions within the confines of fiscal and monetary policy. There are five problems that are discussed in this paper, along with the author's accompanying suggestions for policies that could alleviate the issue."

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