Reference no: EM13852390
1) Define and distinguish between fiscal and monetary policy. Why are they called demand management policies?
2) What are the major tools of fiscal policy? Assume there is a deflationary gap between real output and the potential output of a country. Using a diagram, show how a tax cut can stimulate the output and employment of the economy to take it close to the full employment level of output.
3) What are the major objectives of monetary policy of Australia? Does Australia have an expansionary or contractionary monetary policy?
4) In an AD-AS model, show Australia's current employment and output situation. Discuss how the RBA can increase the output and employment level from its current position.
5) Define ‘economic growth'? What is the average annual rate of real GDP growth of Australia over the last decade? Explain the major sources of growth.
6) What is the definition of ‘supply side policy'? What is the key objective of a supply side policy?
7) What are the major ways a country can restrict its international trade? What are main reasons for imposing trade restrictions?
8) Using a diagram, show the loss of economic benefit to a country due to trade restrictions imposed by tariff.
9) Using a diagram, explain how a decrease in the demand for Australia's iron ore puts downward pressure on the value of Australian dollar
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