Financial regulation and financial institutions

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Financial Regulation and Financial Institutions

FRFI2 Essay question:

In 2020, as a response to COVID19, the Australian government shut down the economy resulting in millions of Australians being unemployed and under-employed. Australia entered its first recession in almost 30 years.

Discuss the RBA's Official Cash Rate (OCR) response to the recession, identify the type of monetary policy enacted and explain the economic impact such an OCR response is intended to have. (7 marks)

Then, discuss the implications of the OCR response on firstly; the disposable income and consumption of families that bear mortgage debt and secondly; on pensioners who rely on deposit interest income for their livelihood. (8 marks)

Reference no: EM133060899

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