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"Describe the current Australian economic situation and support your claims with relevant economic indicators and variables. The RBA has maintained the cash rate of 4.75% for the last 4 months; why could this be a reasonable response given the issues and prospects facing the Australian economy?"
Your Approach should address the following:
- Outline the current economic environment in Australia (inflation, employment, interest rates, etc)
- Briefly outline the key factors (both domestically and abroad) that are influencing the Reserve Bank to maintain the interest rates.
- Using an economic framework to demonstrate and explain the situation
In order to encourage you to take interests in the current affairs in business, and have more concerns about the real world problems (which is what economics is about), you are required to write a three (3) to four (4) pages report (including diagrams) to analyse and answer the assignment question discussing the relevant points on the current macroeconomics environment. You will apply relevant frameworks / models (AE Model, AD / AS Model) to explain and analyse the macro-economic environment and comment on the current government policies.
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