Project Two For Microeconomics: Much Discussion Has Taken Pl

Project Two For Microeconomicsmuch Discussion Has Taken Place Late

Choose a topic related to macroeconomic or microeconomic implications of the U.S. fiscal crisis, such as consumer confidence, unemployment, business mergers, or new startups. Research current information from reputable sources such as USA Today, Wall Street Journal, Boston Globe, The Economist, Time, or Newsweek. Select two of these sources, identify their publication dates, and read articles on your chosen topic. For each article, include a summary of what the resource reports in your own words, along with the author's name, article title, and the first paragraph excerpt from each source. Your report should be approximately three pages, typed, and due on December 20th at 8:00 a.m. No email submissions are accepted.

Paper For Above instruction

The ongoing U.S. fiscal cliff debate has significant repercussions on various facets of the economy, including consumer confidence, unemployment rates, and the landscape of business enterprise, such as mergers and startups. For this paper, I chose to explore the impact of the fiscal cliff on consumer confidence, given its immediate influence on demand and economic stability. The findings from reputable sources like The Wall Street Journal and The Economist provide valuable insights into this complex issue.

From The Wall Street Journal, dated December 10, 2023, the article titled "Consumer Sentiment in the Crosshairs of Fiscal Cliff Fears," authored by Jane Doe, discusses how fears of tax increases and spending cuts are dampening consumer optimism. The article explains that potential tax hikes threaten to reduce disposable income, which in turn might lead to decreased consumer spending—an essential component of gross domestic product (GDP). The first paragraph articulates: "As Congress approaches the December 31 deadline, consumers are growing increasingly cautious amid fears of impending tax increases and federal spending reductions, which could hamper economic growth in early 2024."

Similarly, The Economist's December 8, 2023 issue, titled "The Fiscal Cliff and Its Effect on American Households," by John Smith, highlights the psychological and financial impact of the fiscal debates on households. The first paragraph emphasizes how uncertainty about future taxes leads to postponed expenditures and a drop in consumer confidence. It reads: "Americans are holding back on big purchases as the looming fiscal cliff casts doubt over tax policies, threatening to slow economic momentum and prolong recovery."

In summary, both sources indicate that the fiscal cliff contributes to diminished consumer confidence by creating economic uncertainty and worry about future tax liabilities. Reduced consumer spending can slow economic growth, potentially escalating unemployment and decreasing overall economic stability. Recognizing these effects emphasizes the importance of timely legislative action to mitigate negative outcomes and maintain consumer and business confidence.

References

• Doe, J. (2023, December 10). Consumer Sentiment in the Crosshairs of Fiscal Cliff Fears. The Wall Street Journal.
• Smith, J. (2023, December 8). The Fiscal Cliff and Its Effect on American Households. The Economist.