Macroeconomics Assignment: VAT, Deflation, and Policy Brief

This macroeconomics assignment analyzes the impact of a Value Added Tax (VAT) increase and deflation on the South African economy. It explores the microeconomic and macroeconomic effects of VAT, including its influence on aggregate demand, employment, and government revenue. The assignment further delves into the challenges posed by deflation, such as its impact on GDP, unemployment, and interest rates. It proposes policy briefs to address deflationary conditions, emphasizing the roles of business, the public sector, and the government in encouraging investment, boosting production, and stimulating economic growth. The assignment references key academic sources to support its analysis.