Essay Question (1 Viewer)

[Loz_metalhead]

Examine the economic policies available to deal with inflation in the Australian economy, and explain the limitations of these policies.

That was a 2005 HSC question. I dont know how I could write 4-5 pages on that. Please help. I know the macro and micro economic policies. What else can I include besides a definition​

 

[Riviet]

Well the question also asks you to explain the limitations of these policies, you can write about the effectiveness of each of the policies, e.g monetary policy is a blunt tool, because it affects not just the inflation, but other aspects of the economy like growth and aggregate demand. Because the question had "examine", you could also talk about how effective these policies have been when implemented in the past few decades.

 

[gibbo67]

Examine the economic policies available to deal with inflation in the Australian economy, and explain the limitations of these policies.

That was a 2005 HSC question. I dont know how I could write 4-5 pages on that. Please help. I know the macro and micro economic policies. What else can I include besides a definition​

You're on the right track in regards to answering the question by knowing that the government can use both macro and micro policies. Within the two, you need to flesh out each policy and relate to the relevant cause and effect of each policy e.g. new IR legislation will (supposedly) promote greater ecomomic productivity through increased mobility of labour. From here, you can draw a graph of the labour market showing increased supply and the effect on the economy's aggregate supply.

Markers like to see that recent examples of changes to the economy and recent statistics, so write the paper knowing what the rate of inflation is (this can also be a guide to the tact of writing the paper, since a high rate of inflation (i.e. approaching 3%) will prompt writing about the reserve bank and its possible cause of action (i.e. monetary policy).

It would also be important to explain the effectiveness of the policies on tackling inflation e.g. monetary policy is the blunt instrument of macro policy due to the lag between impact and incidence (about 18 months), its ability to target particular sectors of the economy and some of the other indirect impacts and/or costs of change (e.g. fluctuation of currency value).

 

[Loz_metalhead]

I have only learnt up to inflation. I havent learnt the policies in detail so I guess thats why I am having a hard time trying to answer the question. Thanks. I wont see a question like this on my half yearly then.