Economics HSC Marathon (2 Viewers)

[sk8ie_boi]

Q: What are some of the economic and social costs and benefits of income inequality
A:
economic benefits - the incentive of higher income ==> dis will lead to greater production, higher skilled workforce, technological progression
social benefits - promotes innovation and dynamic society, better standard of living
economic costs - the welfare system
social costs - family tensions, tensions between upper and lower income groups, ==> crimes, other problems in society

Question: When does martet failure occur?

 

[always_smile]

Question: When does martet failure occur?
Market failure occurs because the price mechanism does not take into account social and environmental costs of production but does take into account private benefits and costs of production.

(Price mechanism is the process by which changes in prices ensure that the demand for for goods and services in the economy is exactly equal to to the supply of goods and services)

Q. Outline the costs and benefits of a shift towards a decentralised wage system.

 

[Jago]

In relation to the environment, as the price mechanism does not take into account the social implications of production. It also occurs because the price mechanism does not take account of any depletion of resources that will affect the economy's ability to grow in the future.



Q: Define net foreign debt, net foreign equity and net foreign liabilities

 

[Jago]

Q. Outline the costs and benefits of a shift towards a decentralised wage system.

A:
costs: short-term (structural) unemployment, income inequality

benefits: productivity, reduced inflation

 

[Haku]

Q: Define net foreign debt, net foreign equity and net foreign liabilities

net foreign debt: what we borrow (capital) for overseas - oversea borrowing from australia
net foreign equity: investments in form of FDI and FPI into australia - our foreign investments
net foreign liabilities: net foreign debt + net foreign equity.

lol, ill give some figure: debt current at 51% of GDP
liability at 59.5% of GDP.

 

[sunjet]

net foreign debt: stock of loans owed by aus minus stock of loans owed to aus
net foreign equity: total value of assets in foreign ownership minus assets overseas owed by aus.
net foreign liabilities: net foreign debt + net foreign equity.

 

[sunjet]

Q. Outline the costs and benefits of a shift towards a decentralised wage system.

Benefits: Structural change, efficient allocation of resources, incentive to work -> productivity, can be awarded individually through enterprise agreements, flexible labour market, competitive

Costs: Income inequality, short term unemployment, industrial disputes.

My question:

Discuss the impact and effect of an increased high CAD on an economy and outline methods to improve the CAD.

 

[Jago]

Discuss the impact of changes in interest rates on economic activity

 

[sk8ie_boi]

Discuss the impact of changes in interest rates on economic activity

as interest rates rise => slow down expenditure of consumers => slowing down economic activity/growth

vice versa for decreasin interest rate...

 

[Jago]

Discuss the impact and effect of an increased high CAD on an economy and outline methods to improve the CAD.


- Increases foreign liability - need to finance, debt trap scenario
- increased volatility for exchange rates
- constraints on future economic growth - high e. g. leads to an increase in imports - worsen CAD
- More contactionary eco policy
- lossof international investor confidence - Asian fin crisis

methods to improve cad:
- improve TOT, expanding export base
- financial dereulgation, linked to terms of trade
- greater domestic savings
did i miss anything?

Q. Discuss factors affecting demand for and supply of the Austn dollar

 

[sk8ie_boi]

Q. Discuss factors affecting demand for and supply of the Austn dollar
A. The exchange rate may appreciate or depreciate depending on the market forces of supply and demand. The demand for the Australian dollar will be affected by the size of financial flows into Australia from foreign investors. This inflow will be affected by the level of interest rates in Australia, as high interest rate will encourage foreign investment and also the state of the Australian economy compared to other economies. The demand will also be affected by the expectations of future appreciation of the Australian dollar by speculators. The demand for Australia’s export will also affect the demand for the Australian dollar as foreigners need to convert their currency into Australian dollars to pay Australian exporters. This export demand will be influenced by changes in global conditions, when the world economy is on an upturn, demand and prices for our export will increase. The competitiveness of the Australian exports and taste and preference of overseas’ consumers will also influence demand for export. Factors affecting the supply of Australian dollar include demand for foreign imports by Australian residents and demand for foreign assets such as shares and real estate leads to capital outflow.

Q. What are the bad sides to globalisation? (lol I don't know any big words for bad sides)

 

[Jago]

good answer.

negative impacts of globalisation?

- external instability
- environmental exploits by the poorer countries in order to get $$
- unemployment in the short-term due to increasing access to domestic markets from more efficient importers
- widening gap btn the wealthier and poorer nations of the world
- globalisation creates pressure on countries to keep their labour markets flexible - limits govt regulation


keep it up guys, this is my economics revision hahaha

Q. Briefly explain two reasons why the level of eco activity in one conutry can be affected by eco conditions in other countries

 

[Haku]

as the economies become more and more integrated, our dependant on exports and imports from other economies become a significant factor in our own economic growth. Thus if Aust. growth is higher than that of other nations our levels of import greatly exceed exports leading to external instability and cause economic downturn.

haha, can;t think of two.

 

[Jago]

Foreign Direct Investment, and its effect on the balance of payment and thus economic activity

 

[mattchan]

Q. Briefly explain two reasons why the level of eco activity in one conutry can be affected by eco conditions in other countries

Due to globalisation, often changes in one country can have impacts on another economy. When an economy is experiencing strong economic conditions, they will have more national revenue to spend on buying another country's exports. Thus, the level of economic activity in another country can affect your country similarly.

Another reason may be because of the level of interest rates in another economy. If one country's interest rate is relatively higher than another country, than that country will be more attractive for financial inflows and investment.

Question: Outline environmental management strategies used by the Australian government. (recent or old).

 

[sunjet]

- National Action Plan to improve dry land salinity, $1.4bn to find new ways to use the land, regenerate it, minimise economic loss.
- Taxes/Levy's (Internalise the cost)
- Subsidise environmentally friendly production methods
- Ban
- Tradeable permits

 

[d_a_n_z]

Describe TWO problems assosiated with structural change in teh Australian economy..

btw...PUT A QUESTION AFTER UR ANSWER...

 

[k3tan]

Describe TWO problems assosiated with structural change in teh Australian economy..

btw...PUT A QUESTION AFTER UR ANSWER...

problems associated with structural change
-causes structural unemployment
-the time in which it takes to implement the policies (dunno if thats right?)

name the three major types of inflation.

 

[waterbottle]

cost push, demand pull, imported.

 

[Sparcod]

Types of inflation- demand, cost and imported and government policies

What are the effects of inflation?
Give me 4.