economics assignment

Task Answer four (4) questions. Maximum of 400 words for each question. These are questions which require short answer responses to a series of issues relating to economic principles and concepts. Attempt to answer each question in full and directly. Question 1 (10 marks) Some business commentary suggests that recently the Australian economy has experienced a ‘mining boom’. It is suggested the boom consisted of three phases: 1) a prices boom phase where the price for existing mining outputs increased substantially; 2) an investment phase characterized by the construction of mining infrastructure; 3) a production phase characterized by a significant increase in mining production. For an example of business commentary see: [login to view URL] (accessed 6/5/16) Focusing on how Gross Domestic Product (GDP) is measured through its various components, explain in detail how each of these phases of the ‘mining boom’ impacts on GDP. Make comment on both potential short term and long term effects of the boom and provide statistical evidence to support claims wherever necessary. Question 2 (10 marks) In the 2016-2017 Federal Budget, the Government seeks to focus on ‘jobs and growth’. In part, the policies designed for improving economic growth consists of a focus on the following elements: “The Government is improving the tax system, providing better access to global markets through new export trade agreements, promoting competition, providing vital infrastructure, supporting innovation and entrepreneurship, encouraging high–tech jobs and helping young people get into work.” [login to view URL] (accessed 6/5/16). Discuss and evaluate this government’s focus on how it wishes to promote growth in the context of the typical determinants of economic growth. That is, compare and contrast the standard economic determinants of economic growth with these articulated policies in the 2016-17 Federal Government Budget. Question 3 (10 marks) Using data from the Australian Bureau of Statistics (ABS) [login to view URL] collect information on unemployment and inflation rates for Australia over the period 2005 to 2015, inclusive. Be explicit and define and provide sources for the data obtained. Cite the ABS catalogue number and the date for each data point collected. Plot on a single diagram the relationship between inflation and unemployment, measuring inflation on the vertical axis and unemployment on the horizontal axis. Comment on whether any relationship exists between these variables and any implications of your findings. Question 4 (10 marks) Employ the aggregate demand and supply model for the Australian economy, to analyse the consequences for real GDP and the general price level of the following scenarios. Assume that the economy operates in the intermediate range of the aggregate supply curve. In your response clearly state your assumptions and illustrate your answers with diagrams. (a) the price of iron ore, a major export product, falls substantially, (b) a drought leads to a substantial fall in Australian agricultural output, (c) the government spends significant money in developing a broadband internet network across the country, (d) the price of oil, a product Australia primarily imports, fall substantially.