Due to all the confusion about how internal/external marks of you and your peers can affect your mark, here is the way I understand it to work:
Ok. So your HSC mark is 50% internal and 50% external. However, your internal marks will undergo a process of moderation. This serves as an equaliser if some schools have harder assessments or marks easier etc etc.
So, for example:
Lets say the top three assessment marks submitted by School A are as follows:
98
97
96
And School B's top three assessment marks submitted are:
93
92
91
BUT in the exam, the top three marks for School A are:
94
92
90
and School B:
98
97
95
In this case, the marks are moderated so that the internal (i.e assessment) marks of the top three internally ranked students are changed to whatever the top three exam marks were in that school:
So, this would mean that in School A, the moderated assessment marks for the top 3 internally ranked students would be:
94
92
90
and in School B:
98
97
95
The HSC marks of these students would then be calculated with consideration of the exam mark.
For example, lets say in School A, the student ranked first internally achieved an exam mark of 90.
In this case, their HSC mark would be the average of 94 (their moderated assessment mark) and 90 (thier exam mark). This student would thus have an HSC mark of 92. In this sense, it is clear that the performance of your cohort can affect your assessment mark. However, if you are ranked 1st in both internal and external you will not be affected by the performance of other students in your school.
I'm pretty sure that's how it works, but if any moderaters want to add or correct, feel free
Hope it clarified.