MACRO ASS.docx - Introduction It is almost the end of year...

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IntroductionIt is almost the end of year 2019 and global growth has remained subdued and full ofuncertainties about the future of the global economy due to rising trade and geopoliticaltensions. Prolonged China and United State trade war, Brexit, the US presidential election,EU protectionist trade barriers and geopolitical tensions in the Middle East are expected tobring a negative impact on Malaysia’s economy. In preparation for that, the Malaysiangovernment has announced financial plan - Budget 2020 to cushion the tension forecasted.There are a few key information derived from the article regarding Budget 2020. Thegovernment is expected to increase government spending in the economy than what theyhave collected in areas like targeted fuel subsidy program, funding incentives and grants forsmall and medium scale enterprises as well as decreasing taxes by providing a concession onpersonal income tax for middle-income group(Abdullah, 2019).The two topics that would be used to relate to the article would be Fiscal Policy (Section A)and Aggregate Demand and Aggregate Supply (Section B). The reason why the above twotopics was chosen is due to the fact that Budget 2020’s intention was to increase governmentspending as well as decreasing taxes is clearly a Fiscal Policy and by using AggregateDemand and Aggregate Supply as a topic would allow us to analyze the article’s content in-depth on how the policy would affect AD AS and ultimately achieving macroeconomicobjectives and to build a better a better foundation for a strong economic growth in the midstof the various economic uncertainties. In addition to that, Aggregate Demand is also used as agood indicator of the success of the policy and thus combining Fiscal Policy and AD ASwould be the best option for this article(Kuligowski, 2019).Fiscal policyFiscal Policy is a deliberate adjustment done by the government on Government Spendingand Taxes to achieve desirable economic objectives. For Government Spending, thegovernment holds the power to decide which sector requires an economic boost and of whichpublic goods and services that they should fund in. An extra spending into the macro-

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Term
Spring
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