Reference no: EM132400153

Subject Code and Title - ECON6001 Economic Principles Assignment - Laureate International Universities, Australia

Context: Assignment assesses students' understanding of the implementation of monetary policy, fiscal policy and other unconventional policies to address recessions and stimulate economic growth.

Instructions: In groups of students you are expected to prepare a 2 000 word research report. For the introduction and conclusion you can use up to 200 words. The report should address the following:

The global financial crisis (GFC) of 2008 to 2010 resulted in a downturn in many economies around the world.

(a) Select two macroeconomic variables and discuss the impact of the GFC on the following developed countries: USA, Canada, Singapore, New Zealand and Japan. (400 words).

(b) In order to minimize the negative impact of the recession a number of industrialised countries significantly reduced their key interest rates - the overnight rate (known by different names in different countries). From the list of countries in (a) select any three counties.

(i) Track the monthly overnight rate from 1 January 2007 to 30 June 2019.

(ii) Perform a comparative analysis of how effectively the authorities in those countries have used the overnight interest rate as a tool to manage or contain the global financial crisis. (375 words).

(iii) Discuss how the countries have utilized monetary policy after the global financial crisis (i.e. from 2011 to 2019), highlighting differences if any.

(c) In an environment of low interest rates, critically discuss how effective monetary policy could be in stimulating economic growth and noting some shortcomings.

(d) The cash rate in Australia has been at a level of 1.50% from August 2016 until 5 June 2019 when it was lowered to 1.25%. It was further reduced to 1.0% on 2 July 2019. Critics have been against further cuts in the rate as not beneficial to stimulating the economy. In light of this, what is your view on whether it is worthwhile to use a combination of monetary and fiscal policy to revive the Australian economy? (575 words).

(e) Low interest rates or negative interest rates such as in countries like Japan reduce the effectiveness of monetary policy. Discuss alternative ways to stimulate aggregate demand in such situations. (150 words).

In addition to the above, you will also be assessed on the following:

(f) Content Audience and Purpose.

(g) Critical reasoning, presentation and defence of an argument and/or position.

(h) Analysis and Application with synthesis of new knowledge.

(i) Use of academic conventions and sources of evidence

(k) Effective communication

(l) Peer Review.