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ECON7021
Policy Response
Assessment Task Policy Response Assessment Type Research Report Group or Individual Individual Weighting 30% of course (100 marks reweighted to 30%) Word Limit 1,200 words1 Due Date 6 June, 4 pm Marking Rubric Blackboard > Assessment > Policy Response > Marking Rubric Submission Submit your assessment as a Word document on Turnitin via the course Blackboard site. (See submission details on page 6 of this document.) Academic Integrity UQ has strict rules against academic misconduct, including cheating, plagiarism, colluding and solicitation. You are responsible for preserving the highest standards of academic integrity in your work. Note that you are not permitted to use generative Artificial Intelligence (AI) tools for this assessment task. Please read and familiarise yourself with these rules: PPL 3.60.01 Student Code of Conduct and PPL 3.60.04 Student Integrity and Misconduct. Context We can use both the IS-LM (or IS*-LM* in the case of small open economies) and AD-AS models to illustrate short-run economic fluctuations and the movement to long-run equilibrium. This assessment task, consisting of Part 1 and Part 2, is detailed on the following pages. For Part 1, the relevant topics are Topics 9 and 10. For Part 2, the relevant topics are Topics 10 and 11. 1 The word count excludes the cover sheet, title, section headings, short tables, figures, table and figure headings, figure notes, and the reference list. The word count includes your writing and in-text citations. 2 Part 1: Mundell-Fleming and AD-AS Models (Around 400 words) You must complete this part of the assessment task for your allocated country, with the country allocation indicated in Table 1 below. Table 1 Country Allocation Last digit of your eight-digit student ID Country 0 or 1 Sweden 2 or 3 Norway 4 or 5 Netherlands 6 or 7 Finland 8 or 9 Belgium PLEASE NOTE: • The countries you must use for Part 1 of the research report are based on the last digit of your complete student ID. So, for example, if your student ID is 44194358, then your allocated country for Part 1 is Belgium. • The number in your student email address (e.g., S4419435) is not your student ID; it misses the last digit (i.e. 8 in this example). A 10-mark penalty (out of 100 marks) will be applied if you fail to follow the country allocation rules. In the Impact Comparison research report, you already identified your allocated country’s overall fiscal and monetary policy mix2 in 2022. List that policy mix in Part 1 of this Policy Response research report, and then illustrate and fully explain the short-run and long-run effects of the fiscal and monetary policy mix, ceteris paribus (holding other things equal), using the Mundell-Fleming (IS*-LM*) and AD-AS modelling frameworks. Assume the economy was initially in long-run equilibrium. On the next page are a few tips to consider when writing Part 1. 2 What is a fiscal and monetary policy mix? It is the fiscal and monetary policy stance in a specific period. For example, the country could have implemented expansionary fiscal policy and tighter (contractionary) monetary policy. 3 TIPS: • Part 1 does not require collecting data for economic indicators. • Revise Topics 9 and 10 before completing this assessment task. • Do not provide details of the implemented policies. Instead, you only need to state whether the overall fiscal policy of your allocated country was expansionary or contractionary in 2022 and whether the overall monetary policy of your allocated country was looser (expansionary) or tighter (contractionary) in 2022. • To illustrate the short-run and long-run economic impacts, you must include the Mundell-Fleming (IS*-LM*) and AD-AS model graphs. The graphs should clearly show the relevant movements of the curves and equilibrium variables. Ensure your graphs align with the appropriate IS*-LM* and AD-AS modelling frameworks of Topics 9 and 10. All allocated countries have floating exchange rates, so use the relevant IS*-LM* model. • To explain the economic effects, you must refer to your IS*-LM* and AD-AS graphs. Part 2: AD-AS Model (Around 800 words) Suppose a small open economy with floating exchange rates faces an exogenous shock in the form of a financial crisis. The country’s government aims to stabilise output, while its central bank strives to stabilise prices. Assume the country is initially in long-run equilibrium at its full- employment output level. • First, illustrate and explain the short-run and long-run effects of the financial crisis without policy intervention, ceteris paribus, using the AD-AS model framework of Topics 10 and 11. • Second, consult peer-review journal articles to suggest an appropriate fiscal and monetary policy mix that the government and the central bank should implement in response to the financial crisis, ceteris paribus. • Finally, illustrate and explain the short-run and long-run effects of your suggested fiscal and monetary policy mix using the AD-AS model framework of Topics 10 and 11. Your analysis should demonstrate how the policies will alleviate the adverse effects of the financial crisis. On the next page are a few tips to consider when writing Part 2. 4 TIPS: • Part 2 does not require collecting data for economic indicators. • Revise Topics 10 and 11 before completing this assessment task. • The scenario relates to a hypothetical small open economy with a floating exchange rate; thus, you are not required to consult country-specific sources. • You need to recommend one fiscal policy and one monetary policy. The fiscal policy could be expansionary, contractionary or unchanged (that is, no policy action). And the monetary policy could be looser (expansionary), tighter (contractionary) or unchanged (no policy action). • To motivate your recommended policies, you should cite peer-reviewed journal articles and include the full reference details of those sources in the reference list at the end of your document. • To illustrate the short-run and long-run economic impacts, you must use the AD-AS modelling framework of Topics 10 and 11. Your graphs should clearly show the relevant movements of the curves and equilibrium variables. • To explain the economic effects, you must refer to your AD-AS graphs. References References and citations must be in APA 7th referencing style. TIPS: • Consult the APA 7th referencing style guide. • If you directly quote the original content word for word, it must be in quotation marks. • Only use sources written in English. • You must cite and reference sources even when paraphrasing the original content. • Having more in-text citations and references will reduce the number of words for the main body. But having too few in-text citations and references will lessen the report’s credibility. Therefore, you need to balance the two. • Accessing peer-reviewed journal articles: You can access peer-reviewed journal articles through the UQ Library. Refer to the following guides to help you search for and identify relevant resources. o Subject guide for Economics: https://guides.library.uq.edu.au/economics 5 o Library search: https://web.library.uq.edu.au/research-tools-techniques/library- search o Search techniques: https://web.library.uq.edu.au/research-tools- techniques/search-techniques Additional Requirements Please adhere to the following requirements when compiling your Policy Response research report. Penalties will apply, in line with the marking rubric, if you fail to follow these instructions. PLEASE NOTE: You must use the research report template on Blackboard > Assessment > Policy Response > Template. The template includes a cover sheet. Complete and include this cover sheet with your submission. Do not start your research report on the cover page. Instead, the first page of your research report should be the page after the coversheet (as it is in the template). • Formatting requirements: o Word document o Font type and size: Arial 11 o Line space: 1.5 o Word limit: Maximum of 1,200 words • Referencing style: APA 7th o You can use direct quotes, provided the total number of quoted words is 20 or less in the research report. • Word count: o The word count excludes the cover sheet, title, section headings, short tables, figures, table and figure headings, figure notes, and the reference list. o The word count includes your writing and in-text citations. • Tables and graphs: o Your research report (Part 1 and 2 combined) may include a maximum of four (4) figures (graphs). No tables are required. o Figures may contain more than one graph as long as the included graphs are interconnected, e.g. adding the IS*-LM* and AD-AS models in a figure’s top and bottom panels, with the interconnected variable being output (Y) on the horizontal axes of both graphs. 6 o You must produce your own graphs rather than cut and paste them from other sources. • General: o Do not use footnotes or endnotes. o Use the marking rubric to guide your assessment planning and writing. • Turnitin: o The Turnitin similarity percentage of your report must be below 15%. Submitting Your Assessment • Your research report must be submitted as a Microsoft Word document through Turnitin on Blackboard. • While most instances of plagiarism are unintentional (for example, forgetting to close a quotation mark), the Turnitin originality report will reveal any form of plagiarism (intentional or unintentional) and the use of Artificial Intelligence tools. Your research report should have a Turnitin similarity index value of 15% or less. From the originality report, the marker will check whether any part of your research report is potentially plagiarised from other sources, which could result in mark penalties, as shown in the marking rubric. Therefore, you should carefully review the originality report before your final submission. • You can resubmit your research report multiple times until the due time. However, after three (3) resubmissions, Turnitin will only release the Similarity Report 24 hours after your resubmission. • After uploading your research report, click the Submit to Turnitin button. Then, download your digital receipt in your Assignment inbox to confirm successful submission (refer to the Turnitin student guide)—UQ ITS rule: No digital receipt, no submission. • The deadline for submission is based on the time your assessment has been successfully uploaded on Turnitin, as recorded by Turnitin, not the time you tried to upload it. • Many students fail to meet the deadline because they have internet connection problems on their side, but they mistake it as an IT problem of UQ. If UQ has any internet connection problems, it will keep a record of it. • The only way to guarantee meeting the deadline is to submit your research report well before the deadline.