Monetary & Fiscal Policy

Writing Performance: Score Point 1 Writing Trait: Commentary: Focus & Meaning

There is inadequate or no focus and meaning provided in the response. The response fails to establish a controlling idea or bottom line. Additionally, the writer demonstrates no understanding of the purpose of the task and provides no adaptation to the intended audience. The response satisfies no parts of the task.

In the introduction, the controlling idea is not stated. Readers are only informed of the writer's role as economic adviser but are not introduced to the economic conditions in Macropoland and the economic advisor's mandate to use monetary and fiscal policies to end the recession. ("The first thing that I would do as an economic adviser would be to lower the unemployment rate to half of what it is at now. I would do this by shifting the aggregate demand curve to the right by some sort of way such as producting more in our own country which would open up more jobs to decrease the unemployment rate.")

The writer does not illustrate an understanding of audience by including relevant details to make the ideas clear and convincing. Macropoland is not mentioned at all, and monetary and fiscal policy are not identified or mentioned until well into the response. ("If the inflation rate is to low then I would suggest lowering the interest rates to have more people take out loans, which would poor more money back into the banks and government. Lowering the interest rates would overall increase the money supply, which overall is what expansionary monetary policy is all about.")

Content & Development

There is inadequate or no content and development of ideas in the response. The writer fails to develop ideas, using no business concepts or terms.

Important details, business concepts, and terms are needed to explain and illustrate each main idea. There is inadequate information on the monetary and fiscal policies that can end the recession. Some economics terms are used, but the writer misses the opportunity to expand on the concepts behind the monetary and fiscal policies. ("The first thing that I would do as an economic adviser would be to lower the unemployment rate to half of what it is at now. I would do this by shifting the aggregate demand curve to the right by some sort of way such as producting more in our own country which would open up more jobs to decrease the unemployment rate.")

Specific information about Macropoland's economic situation is inadequate. The writer does not include any of the details about Macropoland's situation, e.g., high unemployment and low inflation. Readers have no way of knowing that the writer is advising Macropoland on the recession issue.

Organization

The writer provides inadequate or no organization of ideas. The essay demonstrates no evidence of structure. Additionally, there is no evidence of paragraphing or grouping of information, logical connections, and transitional devices.

The introduction does not include a clear sentence that conveys the overall message. The first paragraph functions as a body paragraph, not as an introduction. There is no thesis statement or background information on Macropoland. ("The first thing that I would do as an economic adviser would be to lower the unemployment rate to half of

what it is at now. I would do this by shifting the aggregate demand curve to the right by some sort of way such as producting more in our own country which would open up more jobs to decrease the unemployment rate.")

Logical connections and transitions within paragraphs or between sentences are needed. The writer does not connect the ideas within or between paragraphs. Is shifting aggregate demand an aspect of monetary or fiscal policy, or is it the effect that the writer hopes will follow changes to monetary and fiscal policy? How does lowering the unemployment rate fit in with lowering interest rates? ("The first thing that I would do as an economic adviser would be to lower the unemployment rate to half of what it is at now. I would do this by shifting the aggregate demand curve to the right by some sort of way such as producting more in our own country which would open up more jobs to decrease the unemployment rate. . . . If the inflation rate is to low then I would suggest lowering the interest rates to have more people take out loans, which would poor more money back into the banks and government. Lowering the interest rates would overall increase the money supply, which overall is what expansionary monetary policy is all about.")

The conclusion does not summarize the main points of the response. There is essentially no concluding paragraph. Readers do not know whether this is additional or summarizing information, since the details in the essay are so few and disconnected. The last sentence would seem to be the "summary." ("Affecting aggregate demand by increasing it will cause the expansionary fiscal policy to overall benefit for the government. Overall these two concepts will stimulate this economy towards economic growth.")

Language Use & Style

There is inadequate language use and style exhibited by the writer in the response. The writer demonstrates impersonal or unclear and incoherent language and word choice, no awareness of audience, and major errors in sentence structure and usage.

There is repetition of the word "overall." ("Lowering the interest rates would overall increase the money supply, which overall is what expansionary monetary policy is all about." " Affecting aggregate demand by increasing it will cause the expansionary fiscal policy to overall benefit for the government. Overall these two concepts will stimulate this economy towards economic growth.")

The language is informal and word choice is inadequate. ("I would do this by shifting the aggregate demand curve to the right by some sort of way such as producting more in our own country which would open up more jobs to decrease the unemployment rate.")

Mechanics & Conventions

The writer's control of mechanics and conventions is inadequate in the response. Errors are so severe in punctuation, spelling and usage, grammar, and sentence structure that they significantly interfere with the communication of the message and undermine the authority of the writer.

The writer needs to be sure that the essay exhibits appropriate capitalization and punctuation, correct spelling and usage of selected words, and paragraphing with line breaks to separate ideas. The essay is too short to evaluate many of these items effectively. ("If the inflation rate is to low then I would suggest lowering the interest rates to have more people take out loans, which would poor more money back into the banks and government.")

The first thing that I would do as an economic adviser would be to lower the unemployment rate to half of what it is at now. I would do this by shifting the aggregate demand curve to the right by some sort of way such as producting more in our own country which would open up more jobs to decrease the unemployment rate.

If the inflation rate is to low then I would suggest lowering the interest rates to have more people take out loans, which would poor more money back into the banks and government. Lowering the interest rates would overall increase the money supply, which overall is what expansionary monetary policy is all about.

Affecting aggregate demand by increasing it will cause the expansionary fiscal policy to overall benefit for the government. Overall these two concepts will stimulate this economy towards economic growth.

]]> Writing Performance: Score Point 2 Writing Trait: Commentary: Focus & Meaning

There is minimal focus and meaning provided in the response. The writer suggests a controlling idea or bottom line but demonstrates minimal understanding of the purpose of the task. He/she demonstrates more self-absorption than adaptation to the intended audience. In doing so, the writer completes few parts of the task.

The writer suggests, but does not clearly state, the central/controlling idea or bottom line. The response demonstrates minimal understanding of purpose, which is evidenced by the lack of a thesis statement, supporting details, and background information provided for the readers. The first paragraph cannot be considered the introduction since it contains information that should be in a body paragraph. ("In order to help Macropoland get its economy back on track, I would presrcibe expansionary monetary policy in the country.")

Content & Development

The content and development of ideas in the response are minimal at best. The writer develops ideas incompletely and inadequately, using few business concepts and terms.

Specific information about the economic conditions in Macropoland is minimal. The response uses a minimal number of details, business concepts, and terms to illustrate the main idea of proposing a plan to resolve the recession in Macropoland. The writer assumes that readers already have at least a basic understanding of economics and leaves out the details that readers need to fully understand what the writer is proposing. ("For one, expanding the amount of money supply will decrease the interest rate in Macropoland. With the interest rate lowered and more money available, people in the country will begin to be able to invest more due to a low interest rate. At the same time this rise in investment is occuring, a ris in consumption will occur. With a lower interest rate, people will be less inclined to save money due to a lack in growth, this money will then be used to consume. With an increase in both consumption and investment, business and output in the country will grow. An increase in business and output can only be achieved with employees, which will help lower the unemployment in the country.")

Organization

There is minimal organization of ideas in the response. The essay demonstrates little evidence of structure. There is little use of paragraphing or grouping of information, logical connections, and transitional devices as well.

The response demonstrates little evidence of a good introduction, with little background information about the topic and no clear sentence that conveys the overall message. In the first paragraph, there is no mention of the purpose of the essay (to propose policies to end the recession), and the writer moves immediately into the discussion of expansionary monetary policies. ("In order to help Macropoland get its economy back on track, I would presrcibe expansionary monetary policy in the country. This helps in a few ways.")

There is little evidence of logical connections and transitional devices to help connect ideas. The writer describes the effects of the monetary and fiscal policies as if they were dominos falling in sequence. Readers must leap from one effect to the next with no transitions. ("At the same time this rise in investment is occuring, a ris in consumption will occur. With a lower interest rate, people will be less inclined to save money due to a lack in growth, this money will then be used to consume. With an increase in both consumption and investment, business and output in the country will grow. An increase in business and output can only be achieved with employees, which will help lower the unemployment in the country.")

The writer does little to include a conclusion. This two-paragraph essay ends with what is essentially a body paragraph. There is no attempt to summarize information in the essay. ("To further help rise consumption and investment in Macroppoland, I would retarct fiscal policy. Fiscal policy both detracts from investment (by causing the interest rate to rise) and detracting from investment through taxation. Retracting fiscal policy is just another way to help the same factors that increasing monetary policy does.")

Language Use & Style

The writer's use of language and style is minimal in the response. The writer demonstrates unprofessional language and word choice, with little awareness of the intended audience. He/she makes basic errors in sentence structure and usage.

The sentences are too informal and do not effectively communicate the purpose to the intended audience. The writer uses a minimum of economic terms, which combined with the minimal supporting details, can be confusing to readers. ("To further help rise consumption and investment in Macroppoland, I would retarct fiscal policy. Fiscal policy both detracts from investment (by causing the interest rate to rise) and detracting from investment through taxation. Retracting fiscal policy is just another way to help the same factors that increasing monetary policy does.")

Mechanics & Conventions

There is minimal control of mechanics and conventions in the response. There are patterns of errors in punctuation, spelling and usage, grammar, and sentence structure that substantially interfere with the communication of the message and undermine the authority of the writer.

The writer needs to be sure the essay exhibits appropriate capitalization and punctuation, correct spelling and usage of selected words, and paragraphing with line breaks to separate ideas into an organized essay. ("To further help rise consumption and investment in Macroppoland, I would retarct fiscal policy. Fiscal policy both detracts from investment (by causing the interest rate to rise) and detracting from investment through taxation.")

In order to help Macropoland get its economy back on track, I would presrcibe expansionary monetary policy in the country. This helps in a few ways. For one, expanding the amount of money supply will decrease the interest rate in Macropoland. With the interest rate lowered and more money available, people in the country will begin to be able to invest more due to a low interest rate. At the same time this rise in investment is occuring, a ris in consumption will occur. With a lower interest rate, people will be less inclined to save money due to a lack in growth, this money will then be used to consume. With an increase in both consumption and investment, business and output in the country will grow. An increase in business and output can only be achieved with employees, which will help lower the unemployment in the country.

To further help rise consumption and investment in Macroppoland, I would retarct fiscal policy. Fiscal policy both detracts from investment (by causing the interest rate to rise) and detracting from investment through taxation. Retracting fiscal policy is just another way to help the same factors that increasing monetary policy does.

]]> Writing Performance: Score Point 3 Writing Trait: Commentary: Focus & Meaning

There is limited focus and meaning provided in the response. The writer establishes a controlling idea or bottom line but demonstrates little understanding of the purpose of the task. He/she demonstrates self-absorption with little adaptation to the intended audience. Overall, the writer only completes some parts of the task.

The writer states a limited central/controlling idea or bottom line. Readers understand from the introduction that monetary and fiscal policies will be involved in making the economy better for consumers. However, readers have not been provided with details on the Macropoland situation and economic issues. The writer presents readers with only a limited idea of the controlling idea of the essay. ("When looking at the economy at Macropoland, ideas were running through my head to figure out a way to make the economy better and more stable for the residents. The expansionary monetary policy and the expansionary fiscal policy are both going to make the economy better for the consumers.")

Content & Development

The writer provides limited content and development of ideas in the response. Ideas are developed briefly and inconsistently, using limited business concepts and terms.

Specific information about the economic conditions in Macropoland is limited. At the end of the second body paragraph, the writer mentions lowering the unemployment rate and taking the economy out of recession, but there is no mention of those economic conditions earlier in the essay. The writer attempts to define fiscal policy, but it is a vague definition at best. ("The expansionary fiscal policy would be another great idea for the consumers. The fiscal policy is the government purchasing things like good and services and others to impact the economy. The first thing that would need to happen is that taxes would need to be lowered. If the taxes are lowered then income would increase which would lead to more consumer spending. Also, by lowering taxes then investment spending will increase. This will lead to higher GDP once again. All of these thinks will increase economic growth and lower the unemployment which will take the economy out of the recession.")

Organization

The organization of ideas is limited in the response. The essay demonstrates evidence of structure but lacks paragraphing or grouping of information, logical connections, and transitional devices.

The introduction attempts to include a sentence that conveys the overall message. There is very little background information in the introduction, but readers understand from the last sentence that expansionary monetary and fiscal policies will be discussed. ("When looking at the economy at Macropoland, ideas were running through my head to figure out a way to make the economy better and more stable for the residents. The expansionary monetary policy and the expansionary fiscal policy are both going to make the economy better for the consumers.")

Logical connections and transitions within paragraphs or between sentences are needed. The writer does not transition between ideas within the paragraph. For example, the writer launches into reserve requirements after discussing interest rates, and the lack of transitions makes this confusing to readers. ("You have to think about the consumers when thinking about the interest rates. If they are too high then the consumers will be less likely to spend money. The more the consumers invest, the higher the GDP will be. The reserve requirements will help the economy since the banks are required to save 10% of all deposits.")

Language Use & Style

The use of language and style is limited in the response. The writer demonstrates less professional language and word choice, some awareness of audience, and control of voice. He/she relies on simple sentences with insufficient sentence variety and word choice. These elements combine to create a limited message that does not effectively communicate the purpose to the intended audience.

There is repetition, the style is sometimes informal, and language is less professional. ("If the interest rates are lower, then the residents would consider purchasing more items during the time. Let's say that you are interested in buying a car. If the interest rate is at 5%, you are more likely to purchase the car then because you won't have to pay as much as time goes on. Lower interest rates will increase consumer spending. You have to think about the consumers when thinking about the interest rates. If they are too high then the consumers will be less likely to spend money.")

Mechanics & Conventions

There is limited control of mechanics and conventions in the response. Several noticeable errors in punctuation, spelling and usage, grammar, and sentence structure may interfere with the communication of the message and undermine the authority of the writer.

The writer should begin each sentence with a capital letter, make sure each sentence has a subject and a verb, end each sentence with a punctuation mark, check for the correct spelling of words, ensure the proper usage of words within the context of sentences, and indicate new paragraphs with line breaks. ("First of all, you need to know the monetary policy is." "The fiscal policy is the government purchasing things like good and services and others to impact the economy.")

When looking at the economy at Macropoland, ideas were running through my head to figure out a way to make the economy better and more stable for the residents. The expansionary monetary policy and the expansionary fiscal policy are both going to make the economy better for the consumers.

Using the expansionary monetary policy would be great for consumers. First of all, you need to know the monetary policy is. The monetary policy is a way of managing money and interest rates of certain concepts for the Central Bank. The expansionary monetary policy would lower interest rates, which for us would be known as the Federal Fund rates. If the interest rates are lower, then the residents would consider purchasing more items during the time.

Let's say that you are interested in buying a car. If the interest rate is at 5%, you are more likely to purchase the car then because you won't have to pay as much as time goes on. Lower interest rates will increase consumer spending. You have to think about the consumers when thinking about the interest rates. If they are too high then the consumers will be less likely to spend money. The more the consumers invest, the higher the GDP will be. The reserve requirements will help the economy since the banks are required to save 10% of all deposits. It will make it so that the bank will always have money even if people go in and withdrawal money. More than likely, not everybody is going to go in on the same day and withdraw money. All of these things will lower the unemployment rate and let the economy grow out of the recession.

The expansionary fiscal policy would be another great idea for the consumers. The fiscal policy is the government purchasing things like good and services and others to impact the economy. The first thing that would need to happen is that taxes would need to be lowered. If the taxes are lowered then income would increase which would lead to more consumer spending. Also, by lowering taxes then investment spending will increase. This will lead to higher GDP once again. All of these thinks will increase economic growth and lower the unemployment which will take the economy out of the recession.

The expansionary monetary policy and the expansionary fiscal policy are both going to take the economy out of recession. It doesn't matter if you choose one or the other. They will make the economy grow and stabilize. Unemployment rates will be lowered and inflation rates will rise.

]]> Writing Performance: Score Point 4 Writing Trait: Commentary: Focus & Meaning

There is adequate focus and meaning in the response. The writer establishes a controlling idea or bottom line and demonstrates a basic understanding of the purpose of the task. Additionally, the writer adapts the message to the intended audience and completes many parts of the task.

The writer demonstrates an understanding of purpose, with most information contained in the response essential to the overall message. He/she establishes a controlling idea in the introductory paragraph, and the essay develops around that controlling idea. ("This has allowed me to pursue a slightly higher aggregate demand in my proposed policy as there is still a capacity for inflation to quintuple before exceeding the historical average rate of inflation. I put a lot of influence on the utilization of expansionary fiscal and monetary policies in my proposal as I understand that these will be beneficial in reaching the goal.")

The writer adapts the message to the intended audience adequately. He/she maintains a professional tone and includes only adequate supporting details for readers. The writer could improve the essay by providing the audience with additional information and by demonstrating less self-absorption. Four of the six sentences in the introductory paragraph begin with the word "I." ("I have assembled a very effective policy that I foresee enabling the economy of Macropoland to recover sufficiently and provide the boost that is required to control and end the recession which is currently happening. The unemployment level in Macropoland is clearly at a high level. I believe that reducing that level is the key to economic efficiency in this situation. I have noted that inflation is currently resting at a very low rate. This has allowed me to pursue a slightly higher aggregate demand in my proposed policy as there is still a capacity for inflation to quintuple before exceeding the historical average rate of inflation. I put a lot of influence on the utilization of expansionary fiscal and monetary policies in my proposal as I understand that these will be beneficial in reaching the goal.")

Content & Development

The response provides adequate content and development. The writer develops ideas adequately, using some business concepts and terms.

The explanation and details used to explain the main ideas in the body paragraphs are adequate. The writer assumes that readers have at least a basic understanding of economics and thus provides fewer details than optimal. In the paragraph in which the writer outlines the recommended monetary policy changes, he/she writes, "These will both positively affect interest rates...." Readers may not fully understand what a positive effect on interest rates would mean. However, there are enough details in the paragraph for readers to understand the intent and effect of these policies. ("I believe that there are a few expansionary monetary policies that will aid Macropoland's economy as well. I recommend lowering the Federal Discount Rate and the Reserve Requirements put on banks. These will both positively affect interest rates and promote borrowing and spending. When the interest rate that banks pay to borrow from reserve banks is lowered, the banks will borrow larger quantities. Therefore, they have more to loan out to residents and citizens. Lowering the reserve requirement is much the same as it allows banks to hold less at all times. If we encourage the banks to hold less in this way, more money will be circulating in the economy which will again, create more demand and provide more jobs. ")

Organization

The organization of ideas in the response is adequate as well. The essay demonstrates a generally unified structure, while employing the use of some paragraphing or grouping of information, logical connections, and transitional devices.

The introduction includes adequate background information about the topic. The writer introduces the issue (Macropoland recovery), details of the situation (high unemployment, low inflation), and clearly states that he/she will be proposing solutions to the problems using expansionary fiscal and monetary policies. ("I have assembled a very effective policy that I foresee enabling the economy of Macropoland to recover sufficiently and provide the boost that is required to control and end the recession which is currently happening. The unemployment level in Macropoland is clearly at a high level. I believe that reducing that level is the key to economic efficiency in this situation. I have noted that inflation is currently resting at a very low rate. This has allowed me to pursue a slightly higher aggregate demand in my proposed policy as there is still a capacity for inflation to quintuple before exceeding the historical average rate of inflation. I put a lot of influence on the utilization of expansionary fiscal and monetary policies in my proposal as I understand that these will be beneficial in reaching the goal.")

The response demonstrates adequate use of paragraphing or grouping of information. The writer presents his/her monetary policies in the first body paragraph and his/her fiscal policies in the second body paragraph. ("I believe that the Expansionary Fiscal Policy is very effective when attempting to elevate an economy out of a recession." "I believe that there are a few expansionary monetary policies that will aid Macropoland's economy as well.") However, transitions within paragraphs are lacking. ("Therefore, they have more to loan out to residents and citizens. Lowering the reserve requirement is much the same as it allows banks to hold less at all times.")

The conclusion adequately summarizes the main points of the response. The conclusion is only adequate in the details included in the summary of the proposed resolution of the Macropoland issue. ("In present day Macropoland, the largest issue is the high rate of

unemployment. With the appropriate increased government spending, reduction of taxes, and encouragement for banks to borrow and loan more, the money flow will surely reduce the current high unemployment rate.")

Language Use & Style

The writer exhibits adequate language use and style in the response. He/she employs appropriate professional language and word choice, with an awareness of audience and control of voice. The writer generally uses correct sentence structure with some variety.

Some professional language and word choice are seen in the response, and the language and tone are generally consistent. The writer should avoid beginning so many sentences with "I." He/she uses adequate terminology. ("I have assembled a very effective policy that I foresee enabling the economy of Macropoland to recover sufficiently and provide the boost that is required to control and end the recession which is currently happening. The unemployment level in Macropoland is clearly at a high level. I believe that reducing that level is the key to economic efficiency in this situation. I have noted that inflation is currently resting at a very low rate. This has allowed me to pursue a slightly higher aggregate demand in my proposed policy as there is still a capacity for inflation to quintuple before exceeding the historical average rate of inflation. I put a lot of influence on the utilization of expansionary fiscal and monetary policies in my proposal as I understand that these will be beneficial in reaching the goal.")

The lengths of the sentences are adequately varied. Sentences are complex and sometimes compound, without being overly complicated. ("The Fed spends money on securities that it receives by crediting accounts of banks. With this extra credit, banks are predictably going to issue more loans to citizens and companies. Now, we must assume that residents and companies will use a significant portion of this money to purchase things on the market. This higher demand for product increases the demand for workers to produce it. Therefore, the unemployment rate should decrease.")

Mechanics & Conventions

There is adequate control of mechanics and conventions in the response. Although there are some errors in punctuation, spelling and usage, grammar, and sentence structure, they do not significantly interfere with the communication of the writer's intended message.

The writer should ensure that sentences begin with capital letters, sentences have subject-verb agreement, sentences end with appropriate punctuation marks, word selections are spelled and used correctly, and paragraphs are indicated with line breaks. ("This has allowed me to pursue a slightly higher aggregate demand in my proposed policy as there is still a capacity for inflation to quintuple before exceeding the historical average rate of inflation. I put a lot of influence on the utilization of expansionary fiscal and monetary policies in my proposal as I understand that these will be beneficial in reaching the goal.")

Fiscal and Monetary Policy Essay

I have assembled a very effective policy that I foresee enabling the economy of Macropoland to recover sufficiently and provide the boost that is required to control and end the recession which is currently happening. The unemployment level in Macropoland is clearly at a high level. I believe that reducing that level is the key to economic efficiency in this situation. I have noted that inflation is currently resting at a very low rate. This has allowed me to pursue a slightly higher aggregate demand in my proposed policy as there is still a capacity for inflation to quintuple

before exceeding the historical average rate of inflation. I put a lot of influence on the utilization of expansionary fiscal and monetary policies in my proposal as I understand that these will be beneficial in reaching the goal.

I believe that the Expansionary Fiscal Policy is very effective when attempting to elevate an economy out of a recession. The bottom line is we must promote spending amongst the residents and companies in Macropoland. Here, we are considering a two pronged policy to accomplish just that. It includes increasing government spending and or reducing taxes for individuals and small businesses. The increase of government spending is virtually creating money from thin air. The Fed spends money on securities that it receives by crediting accounts of banks. With this extra credit, banks are predictably going to issue more loans to citizens and companies. Now, we must assume that residents and companies will use a significant portion of this money to purchase things on the market. This higher demand for product increases the demand for workers to produce it. Therefore, the unemployment rate should decrease. If you choose to reduce the taxes on residents and small companies, it accomplishes the same thing as they find themselves with larger sums of money to spend. This will continue to raise the aggregate demand. As I mentioned earlier, too sharp of an increase in aggregate demand can cause an increase in inflation. However, in the current situation, Macropoland appears to be far from an equilibrium balance between inflation and demand.

I believe that there are a few expansionary monetary policies that will aid Macropoland's economy as well. I recommend lowering the Federal Discount Rate and the Reserve Requirements put on banks. These will both positively affect interest rates and promote borrowing and spending. When the interest rate that banks pay to borrow from reserve banks is lowered, the banks will borrow larger quantities. Therefore, they have more to loan out to residents and citizens. Lowering the reserve requirement is much the same as it allows banks to hold less at all times. If we encourage the banks to hold less in this way, more money will be circulating in the economy which will again, create more demand and provide more jobs.

In present day Macropoland, the largest issue is the high rate of unemployment. With the appropriate increased government spending, reduction of taxes, and encouragement for banks to borrow and loan more, the money flow will surely reduce the current high unemployment rate.

]]> Writing Performance: Score Point 5 Writing Trait: Commentary: Focus & Meaning

There is good focus and meaning established in the response. The writer establishes and maintains a clear controlling idea or bottom line and demonstrates a general understanding of the purpose. He/she adapts the message to the audience and completes most parts of the task.

The writer demonstrates a thorough understanding of the purpose. All of the details used in the response relate to the central/controlling idea or bottom line, and the writer does not include additional, nonessential information. It is clear from the first paragraph that the writer will be addressing recovering from the recession in Macropoland. The body of the essay effectively discusses different monetary and fiscal policy solutions. ("Pursuing these programs will cause the inflation rate to increase, but because we have low inflation, we have less risk of inflation going out of control as spending starts to increase. By having the ability to increase the inflation rate all the way from 0.4% to 2% we can make sure that inflation does not cut into monetary gain for households and businesses. Another thing that will help the economy of Macropoland is pairing up the changes in monetary policy with changes in fiscal policy to help encourage more consumption and investments while aiding in reducing unemployment.")

Content & Development

The writer provides good content and development of ideas. He/she develops ideas clearly, using business concepts and terms.

The details that are included in each paragraph are connected to the main idea of each topic sentence and include various business concepts and terms. These supporting details, including business concepts and terms, develop the example well. The writer uses

appropriate economics terminology and supports ideas with enough details to make his/her recommendations clear. ("One of the first plans to put forth would be to allow the government to print more money in order to increase the amount of money in circulation. Additionally reductions in interest rates for businesses and homeowners will encourage expansion and facility improvement. These actions would create jobs and stimulate spending by providing incentives for companies to expand their factories and allow homeowners to buy more goods. In the short run, this will increase employment as companies hire more workers to fill the new permanent positions as well as the part time jobs. It will also increase the desire for luxury goods. In the long term, it will help reduce the total unemployment rate and create a better looking investing future which will aid in continued growth. Overall, these actions will increase total consumption and demand which will help to shift the economy away from the recession in consumption spending.")

Organization

There is good organization of ideas in the response. The essay demonstrates a mostly unified structure and consistency in the use of paragraphing or grouping of information, logical connections, and transitional devices.

The response demonstrates an effective introduction, which includes adequate background information about the topic. The introduction would be improved with a more concise thesis statement preparing readers for the discussions on both monetary and fiscal policies that would resolve the recession crisis in Macropoland. Since the writer concludes the introduction with a statement about combining monetary policy with changes in fiscal policy, readers have an adequate understanding of what to expect in the remainder of the essay. ("Macropoland is currently experiencing a recession in consumption spending with sluggish investments and an unemployment rate of 9%. Currently, inflation is very low at 0.4%. One of the keys to help Macropoland's economy to experience growth is this low inflation rate. Since Macropoland is experiencing an historically low interest rate opposed to its average of 2%, this allows us to be able to adopt a monetary expansion policy to increase the money in circulation and to enact programs geared towards increasing spending and money available at all income levels. Pursuing these programs will cause the inflation rate to increase, but because we have low inflation, we have less risk of inflation going out of control as spending starts to increase. By having the ability to increase the inflation rate all the way from 0.4% to 2% we can make sure that inflation does not cut into monetary gain for households and businesses. Another thing that will help the economy of Macropoland is pairing up the changes in monetary policy with changes in fiscal policy to help encourage more consumption and investments while aiding in reducing unemployment.")

Logical connections and transitions within paragraphs or between sentences are used well. However, the writer could identify the monetary and fiscal policy discussions more clearly. He/she uses very effective transitions like "overall," "additionally," "one of the first tools," and "with these changes."

The conclusion summarizes the main points of the response well. ("While Macropoland is currently facing a recession in consumption spending, low investments, and high unemployment; the low inflation rate allows for the use of different policy changes that can be pursued in order to turn around the economy and head towards positive growth. With an historically low interest rate, the risk of changing economic policies is reduced and the number of programs that can be

undertaken is greater than if the economy was already at its average of 2% inflation. Increasing the money supply will lead to a total growth in the amount of disposable income. By having more income available all levels of the economy households, government, and business will be able to increase investments and spending which will lead to more consumption and lower unemployment. Decreasing taxes across all income levels will provide benefits to help encourage growth from the increase in consumption and production. Business will be able to expand their factories and increase the number of workers. Through the government increasing unemployment benefits and providing government work projects, short term unemployment will decrease. This will also increase the wealth across all income levels which will help to maintain the positive increase in the total output of the economy. With the combinations of these factors, the economy of Macropoland will be able to start to make positive gains.")

Language Use & Style

The writer exhibits good use of language and style in the response. The writer demonstrates appropriate professional language and word choice, with some evidence of voice and a clear sense of audience. Additionally, the use of well-structured and varied sentences adds to the effectiveness of the overall message.

The language and tone are consistent, appropriate, and professional. The writer uses a professional tone, which is very effective when combined with the academic economics terminology. ("Macropoland is currently experiencing a recession in consumption spending with sluggish investments and an unemployment rate of 9%. Currently, inflation is very low at 0.4%. One of the keys to help Macropoland's economy to experience growth is this low inflation rate. Since Macropoland is experiencing an historically low interest rate opposed to its average of 2%, this allows us to be able to adopt a monetary expansion policy to increase the money in circulation and to enact programs geared towards increasing spending and money available at all income levels.")

Sentences are well structured and varied. They are rich in details yet not overly long and complicated, which enables readers to easily follow the writer's logic. ("Due to the accompanying increase in wealth, businesses will be able to purchase new equipment to increase their production as well as building new factories. This stimulates growth in the economy by increasing investment spending as more business are able to afford to increase their sizes. The decrease in taxes will also allow household to keep more money that they can choose to either add to the number of investments or to spend on consumption.")

Mechanics & Conventions

The response exhibits good control of mechanics and conventions. There are few errors in punctuation, spelling and usage, grammar, and sentence structure, and they do not interfere with the writer's intended message.

The writer should ensure that all sentences have appropriate capitalization and punctuation, all sentences have subject-verb agreement, all word selections are used and spelled correctly, and line breaks are used to indicate new paragraphs. ("With an historically low interest rate, the risk of changing economic policies is reduced and the number of programs that can be undertaken is greater than if the economy was already at its average of 2% inflation. Increasing the money supply will lead to a total growth in the amount of disposable income. By having more income available all levels of the economy households, government, and business will be able to increase

investments and spending which will lead to more consumption and lower unemployment.")

Macropoland is currently experiencing a recession in consumption spending with sluggish investments and an unemployment rate of 9%. Currently, inflation is very low at 0.4%. One of the keys to help Macropoland's economy to experience growth is this low inflation rate. Since Macropoland is experiencing an historically low interest rate opposed to its average of 2%, this allows us to be able to adopt a monetary expansion policy to increase the money in circulation and to enact programs geared towards increasing spending and money available at all income levels. Pursuing these programs will cause the inflation rate to increase, but because we have low inflation, we have less risk of inflation going out of control as spending starts to increase. By having the ability to increase the inflation rate all the way from 0.4% to 2% we can make sure that inflation does not cut into monetary gain for households and businesses. Another thing that will help the economy of Macropoland is pairing up the changes in monetary policy with changes in fiscal policy to help encourage more consumption and investments while aiding in reducing unemployment.

One of the first plans to put forth would be to allow the government to print more money in order to increase the amount of money in circulation. Additionally reductions in interest rates for businesses and homeowners will encourage expansion and facility improvement. These actions would create jobs and stimulate spending by providing incentives for companies to expand their factories and allow homeowners to buy more goods. In the short run, this will increase employment as companies hire more workers to fill the new permanent positions as well as the part time jobs. It will also increase the desire for luxury goods. In the long term, it will help reduce the total unemployment rate and create a better looking investing future which will aid in continued growth. Overall, these actions will increase total consumption and demand which will help to shift the economy away from the recession in consumption spending.

Three main tools exist that can be used on the fiscal policy front that will aid in solving Macropoland's economic problems. One of these is for Macropoland to cut taxes across all income levels. This upward shift in the disposable income available at each income level will help to increase consumption. The reason for this is that with the increase in the availability of wealth at each income level more people will be able to purchase more goods which will help to drive up demand for all available goods. This will stimulate both aggregate production and employment; therefore, business will need to increase the supply of goods in order to meet this new demand. Due to the accompanying increase in wealth, businesses will be able to purchase new equipment to increase their production as well as building new factories. This stimulates growth in the economy by increasing investment spending as more business are able to afford to increase their sizes. The decrease in taxes will also allow household to keep more money that they can choose to either add to the number of investments or to spend on consumption.

With these changes to the economy, unemployment should be decreasing; however, if the unemployment rate is still too high, a tool that the government could use would be to increase the amount of money given to people on unemployment. By increasing the money given to people on unemployment, under conditions of attending skill training or by furthering their education, those unemployed due to the structural constraints of the job market will be able to find work and decrease the unemployment rate. This increase in investing towards the future provides incentives for companies to offer more job training or other internship openings in order to profit from the gains of a more experienced work force. As the economy begins to recover from the jobs lost due to the recession and businesses begin to hire again, those that lost their jobs due to the recession will have jobs again as the economy recovers.

The final tool that the government of Macropoland could use to help fight the recession and to turn the economy towards a positive growth would be to increase government spending on public work projects. One such project would be if the government invested in the repairing or construction of new roads which would provide more efficient transportation inside Macropoland. This improvement in the road network would allow for cheaper transportation of goods as well as provide short term job creations and increase revenue. Another way would be to increase the national defense budget and produce new military equipment or technologies. These government grants would provide incentives for business to invest in that particular new field due to the lower risk of loss. In turn this would provide more jobs and more revenue leading to a total increase in GDP for Macropoland.

Additionally, the road projects would have a synergistic interaction with the monetary expansion policy. Taken together, both of these policies will increase consumer demand. This increase in consumer demand will create a need for greater production capacity. An expansionist monetary policy creates a climate which encourages businesses to increase production to take maximum advantage of the new transportation efficiencies.

While Macropoland is currently facing a recession in consumption spending, low investments, and high unemployment; the low inflation rate allows for the use of different policy changes that can be pursued in order to turn around the economy and head towards positive growth. With an historically low interest rate, the risk of changing

economic policies is reduced and the number of programs that can be undertaken is greater than if the economy was already at its average of 2% inflation. Increasing the money supply will lead to a total growth in the amount of disposable income. By having more income available all levels of the economy households, government, and business will be able to increase investments and spending which will lead to more consumption and lower unemployment. Decreasing taxes across all income levels will provide benefits to help encourage growth from the increase in consumption and production. Business will be able to expand their factories and increase the number of workers. Through the government increasing unemployment benefits and providing government work projects, short term unemployment will decrease. This will also increase the wealth across all income levels which will help to maintain the positive increase in the total output of the economy. With the combinations of these factors, the economy of Macropoland will be able to start to make positive gains.

]]> Writing Performance: Score Point 6 Writing Trait: Commentary: Focus & Meaning

There is very effective focus and meaning in the response. The writer establishes and maintains an insightful controlling idea or bottom line and demonstrates a thorough understanding of the purpose of the task. Additionally, he/she clearly adapts the message to the intended audience. The writer successfully completes all parts of the task.

The writer clearly demonstrates a thorough understanding of the purpose. This is evident because all of the details used in the response relate to the central/controlling idea or bottom line very effectively, and the writer does not include additional, nonessential information. The controlling idea is evident in the first paragraph and is supported throughout the essay. ("It is the author's belief that the objectives of lowering unemployment, encouraging investment, and increasing economic growth can all be achieved with a combination of fiscal and monetary policy applied in a coordinated manner. The following are the recommendations needed to achieve these outcomes, including an explanation and description of the dynamics of the economic processes.")

Content & Development

The response demonstrates very effective content and development. The writer develops ideas fully and memorably, using appropriate business concepts and terms.

Appropriate business concepts and terms are used very effectively within the response. The writer uses economics terms liberally throughout the essay. However, he/she does not assume that readers will understand these terms and concepts without at least a brief explanation or definition. This approach enables readers to easily follow the writer's reasoning. ("It should be noted that the reason for recommending a combination of both fiscal and monetary responses is to avoid economic situations known as a liquidity trap. A liquidity trap is an economic situation in which interest rates are near zero and fluctuations in the money supply fail to stimulate economic growth. This can occur from the implementation of an expansionary monetary policy without a fiscal component. It is this reasoning that makes it necessary to adopt fiscal and monetary policies together.")

Organization

The organization of information in the response is very effective as well. The essay demonstrates a cohesive and unified structure with effective use of paragraphing or grouping of information, logical connections, and transitional devices throughout.

The introduction includes a very effective sentence that conveys the overall message. The writer presents background information and

ends the introduction with a strong thesis statement. ("The purpose of this report is to prescribe a recommended economic policy for the President of Macropoland. The recommendations contained within this report have been developed to address the administration's expressed goal of enabling the economy to recover from the current recession. Throughout the course of this report the author will advocate for a policy-mix that incorporates a coordinated effort between the Macropolish government and the central bank of Macropoland. It is the author's belief that the objectives of lowering unemployment, encouraging investment, and increasing economic growth can all be achieved with a combination of fiscal and monetary policy applied in a coordinated manner. The following are the recommendations needed to achieve these outcomes, including an explanation and description of the dynamics of the economic processes.")

Logical connections and transitions within paragraphs or between sentences are used very effectively. The writer moves logically through his/her reasoning, using topic and transition sentences to move smoothly between concepts without losing readers. ("In order to formulate a recommendation two basic assumptions are needed." "However, inflation can be used as an indicator as to whether the economy has achieved this natural level of output. ...Referring back to the historical levels of inflation at 2% we are able set a target range of inflation between 2% and 3%.")

The conclusion summarizes the main points of the response very effectively. The writer summarizes the main points of both fiscal and monetary policies and the expected result of his/her recommendations. ("In conclusion, it is the position of this report that a fiscal-monetary policy mix can be used to achieve the executive office's goal of lowering unemployment, increasing investment, and increasing economic output. Through an increase in government spending and an expansion of the money supply the economy can be stimulated to full output. However, an optimal outcome will require the full cooperation of the legislative branch of government as well as the central bank.")

Language Use & Style

The writer demonstrates very effective language use and style throughout the response. He/she employs precise, professional language and word choice, a defined voice, and a clear sense of audience. The use of well-structured and varied sentences adds to the effectiveness of the writer's message.

Language and word choice in the response are professional in nature. The writer uses concise, academic/professional language throughout. Sentences are well structured and long enough to convey the message without overcomplicating it. ("The first of the recommendations of this report is the implementation of a new fiscal policy. The purpose of this policy would be to increase the government component of autonomous spending. The recommended fiscal policy would be centered on an increase to government spending while holding taxes at current levels. While a decrease in taxes would also increase one of the autonomous spending components, causing a multiplied increase to GDP, the effect would not be as great. This occurs because a portion of income that tax payers receive from lower taxes will be saved instead of being spent. This results in a smaller increase to the autonomous component of output.")

Mechanics & Conventions

The writer demonstrates very effective control of mechanics and conventions. There are few or no errors in punctuation, spelling and usage, grammar, and sentence structure.

The writer exhibits very effective control of mechanics and conventions. There are few or no errors in grammar, mechanics, punctuation, or spelling. For example, each sentence begins with a capital letter, each sentence has a subject and a verb, each sentence ends with an appropriate punctuation mark, each paragraph is indicated by a line break, and word choices are spelled correctly. ("A liquidity trap is an economic situation in which interest rates are near zero, and fluctuations in the money supply fail to stimulate economic growth. This can occur from the implementation of an expansionary monetary policy without a fiscal component. It is this reasoning that makes it necessary to adopt fiscal and monetary policies together.")

Economic Advisory Report

The purpose of this report is to prescribe a recommended economic policy for the President of Macropoland. The recommendations contained within this report have been developed to address the administration's expressed goal of enabling the economy to recover from the current recession. Throughout the course of this report the author will advocate for a policy-mix that incorporates a coordinated effort between the Macropolish government and the central bank of Macropoland. It is the author's belief that the objectives of lowering unemployment, encouraging investment, and increasing economic growth can all be achieved with a combination of fiscal and monetary policy applied in a coordinated manner. The following are the recommendations needed to achieve these outcomes, including an explanation and description of the dynamics of the economic processes.

The "natural level of output" is an economic term that describes an economy that is operating at long run full potential of aggregate output. In the long run this is the equilibrium level of output that economies will settle at naturally without intervention. However, in the short run economies can deviate from their natural levels. When short-run output is lower than the long run natural level the economy will experience a recession or even a depression. Throughout the course of this report the terms "natural level" and "full potential" will be used interchangeably.

It is a widely held economic principle that an increase in any of the autonomous spending components of GPD will result in a multiplying effect on total economic output. This means that a one dollar increase in one of these factors will lead to a greater than one dollar increase to output. The resulting increase is actually several fold the change in the autonomous spending component. Incidentally, the multiplying amount of change is controlled by the autonomous spending multiplier, which is a function of the population's propensity to consume.

The four components of autonomous spending are: autonomous consumption, investment spending, government spending, and reductions in taxes. Although governments lack the ability to directly control autonomous consumption or investment spending they can control tax rates and government spending. This is crucial to understanding a government's ability to affect the economy. The key concept to understand from all of this is that for every dollar the government invests in stimulating the economy output will grow by some multiplied amount. This is the principle that has been used in the development of the fiscal recommendations of this report.

In order to formulate a recommendation two basic assumptions are needed. The first of these assumptions is that the economy of Macropoland is not currently operating at the natural level of output. The second assumption it is that the goal of increasing economic growth is correlated with lower unemployment but not necessarily with increases to investment spending. The investment component of this assumption will be addressed in a later section of this report, as well as the policies needed to encourage greater investment. There are two key facts that led the author of this report to the assumption that the economy is not operating at full potential. The first fact is that unemployment is high. An unemployment rate of 9% is considered high by the standards of most developed nations. The second fact that provides evidence of this is that the inflation rate, at 0.4% is lower than the historical levels of 2%.

The first of the recommendations of this report is the implementation of a new fiscal policy. The purpose of this policy would be to increase the government component of autonomous spending. The recommended fiscal policy would be centered on an increase to government spending while holding taxes at current levels. While a decrease in taxes would also increase one of the autonomous spending components, causing a multiplied increase to GDP, the effect would not be as great. This occurs because a portion of income that tax payers receive from lower taxes will be saved instead of being spent. This results in a smaller increase to the autonomous component of output. Furthermore, the percentage of the tax cut that will be added to the autonomous component of output is dependent on the tax payers' propensity to consume and is beyond the control of government policy. While the return on

"investment" from a tax cut is greater than the amount of the tax cut, the resulting GDP would be less than the same dollar spent on a government spending increase.

The second major recommendation of this report is in the area of monetary policy. This portion of the policy mix will require the cooperation and coordination on the part of the central bank of Macropoland. Monetary policy plays a crucial role in the area of private investment. Although government spending will provide a multiplying increase to total output it does come with a negative side effect. Output increases from government spending will cause interest rates to rise. Investment spending is a negative function of interest rates. Therefore, the higher increase in rates will reduce private sector investment. This phenomenon of lower investment from output increases from government spending is known as the "crowding out effect".

The main reason for adopting an expansionary monetary element for this policy recommendation is to avoid the crowding out effect of fiscal policy and in turn encourage greater investment spending. It is the author's position that an increase to the money supply is the optimal solution to stimulate investment spending. An increase of the money supply is known to drive down interest rates. Even though the central bank does not have direct control of the money supply it does possess the ability to increase the monetary base. This could be achieved by engaging in open market operations, in which the central bank would purchase Macropolish government securities.

It is not the purpose of this report to set an ideal interest rate. Rather, this report is recommending that the unemployment rate be targeted. The targeted rate will be the natural rate of unemployment, which occurs at the point where the economy is operating at full potential. Unfortunately this exact number is never known. However, inflation can be used as an indicator as to whether the economy has achieved this natural level of output.

Referring back to the historical levels of inflation at 2% we are able set a target range of inflation between 2% and 3%. This inflation range can be used as a benchmark to signal that full employment has been achieved, indicating the appropriate time to cease expansionary open market operations by the central bank. In order for the economy to enjoy stability the central bank will need to demonstrate a willingness to prevent inflation from increasing beyond comfortable levels. It is this reason for recommending that maintaining a low inflation rate be adopted as a secondary policy goal. It is believed that 3% should be established as the maximum level of inflation the central bank will allow before invoking a contractionary policy. Keeping inflation levels low will prevent inflation expectations from rising and in turn will avoid excessive increases in the price level.

It should be noted that the reason for recommending a combination of both fiscal and monetary responses is to avoid economic situations known as a liquidity trap. A liquidity trap is an economic situation in which interest rates are near zero, and fluctuations in the money supply fail to stimulate economic growth. This can occur from the implementation of an expansionary monetary policy without a fiscal component. It is this reasoning that makes it necessary to adopt fiscal and monetary policies together.

In conclusion, it is the position of this report that a fiscal-monetary policy mix can be used to achieve the executive office's goal of lowering unemployment, increasing investment, and increasing economic output. Through an increase in government spending and an expansion of the money supply the economy can be stimulated to full output. However, an optimal outcome will require the full cooperation of the legislative branch of government as well as the central bank.

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