Macroeconomics or Microeconomics

Order Description There are 2. Choose 1 and write an essay. OPTION 1: Microeconomics “Identify a good on sale in the UK whose price has changed after the Brexit vote. Write a report describing how you expect demand will change.” [Guidance: While the report should make reference to relevant microeconomic theory, it must be adapted to the particular good you are studying. In intermediate economics we have talked about goods in general. For the report, you should conduct some research on the specific good you choose and reason beyond what is taught in intermediate economics.] OPTION 2: Macroeconomics A model such as IS-TR (or IS-LM) makes very clear predictions about policy when interest rates are very low (often referred to as the zero lower bound or liquidity trap). Use theory to describe the intuition behind these results. Have policymakers followed the advice of such models, and if not, why not? [Guidance: Make sure you address all parts of the question, and with appropriate weight (although the decision on where to place emphasis is for you to make). The latter part of your essay is likely to draw on real-world evidence (i.e. what has actually happened), before considering the extent to which policy has followed the advice of our simple models, and if not, why not (e.g. is the theory wrong; does the theory have limitations; has the theoretical advice simply not been followed). Note that there is not some correct answer that you should be striving for – instead we are looking for thoughtful and coherent evidence-based discussion.]