Aggregate Demand and Supply Models Paper

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Submitted By linettepugh
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ECO 372 Principles of Macroeconomics
Week Three Team Assignment
Aggregate Demand and Supply Models
Linette Pugh, Jyenna Baeza
University of Phoenix Online
Professor: Leo Stevens

Unemployment
The United States is recovering from a recession and high unemployment numbers. As of December 2013 the Bureau of Labor statistics reported that unemployment is down 6.7% from 7%. The number of unemployed persons declined by 490,000 to 10.4 million in December, and the unemployment rate declined by 0.3 percentage point to 6.7 percent. 2013 reported 11 million Americans out of work and 4.4 million people who have been unemployed for six months or longer. Over the year, the number of unemployed persons and the unemployment rate were down by 1.9 million and 1.2 percentage points, respectively ("The Employment Situation 2013", n.a). Michigan and Indiana are the two states that are reporting the highest unemployment which are 8.5% and 8.7% ("Important Unemployment Figures", 2013). While the numbers are starting to decline, unemployment is on the minds of many Americans. Since the future is so unsecure people are saving instead of spending, they are preparing for that day in case it comes. Demand starts to go down and the aggregate demand curve shifts to the left. President Obama realizes that incentives need to be made to help our economy prosper. On April 5, 2012, the president signed a bill called the (JOBS) Act. This bill allows starters to raise capital more quickly from investors. It also focuses on connecting mentors, reducing barriers, accelerating innovation and unleashing market opportunities ("Startup America", n.d). Other incentives are the Recovery Act. This act was enacted on February 17, 2009; its goal was to create jobs. It has three parts: Tax cuts, direct relief to state government and individual and investment in roads. As of July 2013, the…...

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