stuff from past papers

Question 1

effects of depreciation on BOP

Answer 1

ST:
- worsen BOGS (decrease X rev and increase M spending)
- worsens NPY/increase KAFA (aus assets cheaper to purchase)

LT:
- improve BOGS (increase X volumes and decrease M volumes)
- decrease KAFA/improve NPY (if further depreciation is expected)
- worsen NPY debits = higher debt servicing cost

Question 2

cost of ecologically sustainable development

Answer 2

• low EG due to low productivity using sustainable methods

Question 3

limitations of monetary

Answer 3

= BLUNT INSTRUMENT
- short term change = can be changed 11 times during year
- implementation lag = 9-18 months to implement
- can’t maintain all objectives simultaneously
- can’t address demand side issues (exogenous shocks such as oil prices despite 13 consecutive CR increases post COVID)
- conflict with fiscal?

Question 4

analyse how changes in the international BC have impacted China

Answer 4

China ???

Question 5

effects of gov tax on income and wealth redistribution

Answer 5

• progressive tax = improves
• GST regressive tax = worsens
• auto-stabilisers = improves during cyclical downswing
• super progressive tax = improves

Question 6

impact of limitations on economic policies in achieving enviro sustainability

Answer 6

• political constraints
• time lag
• lack of enforceability
• increased COP and decreased int. comp.

Question 7

Explain the possible effects of a reduction in global trade protection on the global distribution of income.

Answer 7

• overall increased global income distribution
• developing economies gain access into developed economies market through removing trade barriers, increasing Y
• through TNC’s enable further investment and tech and capital into developing to increase EG and Y
• cheaper imports = increases disposable Y
• talk about WTO
• specialise and allocate efficiency

Question 8

How can family structure contribute to income inequality?

Answer 8

• increased single parents = increased income inequality
• single parent households earn less income than couples

Question 9

Analyse the economic and social costs of an increase in income inequality.

Answer 9

• economic: lower participation rate and employment (decreased incentive to work)
• economic: lower EG (lower income earners = higher propensity to consume) (decreased participation rate = decreased labour as FOP)
• social: class divide
• social: increased crime rates
• social: increased mental health issues –> decreased SOL compared to others

Question 10

Explain how the use of individualised methods of determining employment contracts may benefit employers and employees.

Answer 10

• employers: increased flexibility to retain valued members / increased incentive to increase productivity and output and profits
• employees: increased wages

Question 11

Explain likely changes to the structure of industry in Australia as a result of current trends in the global economy.

Answer 11

• ChaFTA = increase manufacturing imports = structural shift from manufacturing toward services
• EU CAP = decrease agricultural exports = structural shift from agriculture toward services
• foreshadowed decline in mining industry = countries phasing out of non-renewable resources
• COVID = decrease in service exports

Question 12

Outline ONE disadvantage to the developing economy of entering into this multilateral free trade agreement with developed countries.

Answer 12

• no protection for infant industries = decreased domestic production and structural U/E
• dumping threat = decreased domestic production and structural U/E
• weaker bargaining power hence poorer trades

Question 13

causes of recent low wage growth

Answer 13

• Declining union membership
• Increased pressure from foreign competition impacting on wage costs
• Increased substitution of capital for labour
• Reduced bargaining power of workers
• Movement of workers from mining sector into lower paying jobs (post mining boom).