Reference no: EM132181399
1. Explain why the Reserve Bank of Australia (RBA) may increase the cash rate, leading to an increase in interest rates in the economy. Discuss the possible effects an increase in interest rates will have on the economy.
2. Explain why a decrease in interest rates may have a limited effect on improving Australia's level of economic performance.
3. With reference to both demand and supply factors, explain how the price of the Australian dollar (AUD) is determined in the foreign exchange market (FOREX).
4. Discuss two (2) factors responsible for the rise of in the value of the AUD in recent years?
5. Use the model of demand and supply to explain the impact of a rent ceiling in the rental housing market in Perth, Western Australia. In your diagram, explain what would happen in the rental housing market if the price of non-rental apartments decreases
6. Show the impact on the tobacco (cigarettes) market if the Russian government imposed a large tax on tobacco. Discuss the incidence of the tax.
7. What would happen in the tobacco market if the Russian government increased advertising explaining the negative health impacts from smoking? Why?