MAE 203 Deakin Business School Global Economy Worksheet


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MAE203 – The Global Economy – Trimester 1 2022
Assessment 2 – Written Assignment
Friday, 13th May 2022 by 8:00pm (AEST) in CloudDeakin
2,000 words
This assignment consists of three questions which need to be answered in full (refer to page 2
onward). The assessment must be completed individually and needs to be submitted in
CloudDeakin assignment submission box by the due date and time.
Learning Outcomes
This task allows you to demonstrate achievement towards the unit learning outcomes. The ULOs
are aligned with specific graduate learning outcomes – that is, the skills and knowledge graduates
are expected to have upon completion of their studies – and this assessment task is an important
tool in determining achievement of those outcomes.
It is good practice to familiarise yourself with the ULOs and GLOs as they provide guidance on the
knowledge, understanding and skills you’re expected to demonstrate upon completion of the unit.
In this way they can be used to guide your study.
Unit Learning Outcomes (ULO)
Graduate Learning Outcomes (GLO)
ULO 1: Understand, describe and apply
key macroeconomic concepts in a global
ULO 2: Obtain, present graphically and
interpret data for macroeconomic
ULO 3: Critically analyse the role of
monetary and fiscal policy in a globalised
ULO 4: Understand the opportunities for
economists in a global context
GLO key: GLO1: Discipline-specific knowledge and capabilities, GLO2: Communication, GLO3: Digital literacy, GLO4:
Critical thinking, GLO5: Problem solving, GLO6: Self-management, GLO7: Teamwork, GLO8: Global citizenship
Assignment questions
Q1. Go to the World Development Indicators database from the World Bank website. Now gather
the following data for inflation, unemployment, real GDP per capita and real GDP for the following
countries for the time period 1980 till 2020 (i.e., for all years starting from the year 1980, then
1981, 1982, 1983, …, so on till 2020). Note that for some countries, the start time for some data
series will be different, please ignore these and download all the available data reported on the
Data series
Inflation => Inflation, consumer prices (annual %)
Unemployment => Unemployment, total (% of total labor force) (national estimate)
Real GDP per capita => GDP per capita (constant 2015 US$)
Real GDP => GDP (constant 2015 US$)
Australia, New Zealand, Indonesia, South Korea (Republic of Korea), Japan, Singapore, United
Kingdom, China, India and United States of America.
1980 to 2020 (all years starting from 1980 till 2020)
Based on the data series downloaded, calculate the annual growth rate of real GDP capita in
each country (use a spreadsheet program like excel for calculation). Then compute the average
annual growth rate in the real GDP per capita in each country for these 40-year period. Using the
above information and discussion in the unit, explain if there is any evidence of catching-up
amongst these ten countries?
(ii) Now for each country, calculate the real GDP growth rate for each year (use a spreadsheet
program like excel for calculation). Then plot the real GDP growth rate and the inflation rate series
together for all the years in each country separately. Discuss and explain if you find any pattern and
relationship between these two data series in each country.
(iii) Now plot the real GDP growth rate and unemployment series together for all the years in each
country separately except for India and Indonesia. Discuss and explain any pattern and relationship
between these two data series for all the eight countries.
[10 + 10 + 8 = 28 marks]
Q2. In the recently announced Federal budget, the Australian Treasurer, Mr. Josh Frydenberg has
outlined a number of initiatives. Attached please find one news report highlighting the major steps
announced in the budget
Based on your understanding of the Aggregate Expenditure model, explain how such policy
measures would affect the macroeconomy in the short run. Provide adequate illustration of the
Aggregate Expenditure model and show how the budgetary actions would impact the economy
using the model.
[Note that when answering this question, you do not have to use actual numbers from the budget.
You can use some hypothetical numbers in support of your argument.]
[8 + 8 = 16 marks]
Q3. Refer to the latest monetary policy decision statement by the Governor of the Reserve Bank of
Australia (RBA), Mr. Philip Lowe.
Using the static aggregate demand and aggregate supply (AD-AS) model, show and explain how the
inflationary pressure scenario discussed in the article could be identified. What kind of remedial
monetary policy measure would you recommend for the RBA? Explain the appropriate monetary
policy action and illustrate using the static AD-AS model the effect of such policy stance on the
long-run equilibrium in the economy.
[8 + 8 = 16 marks]
The assessment answers must be typed. Answers should be in full sentences, which have been
checked for grammar and spelling. Marks will be deducted if your ideas are expressed poorly or are
confused and cannot be awarded if your expression is ambiguous. Data should be neatly presented
in table and graph format where requested, with sources correctly documented. The tables and
graphs should have a relevant title and each axis on the graphs should be correctly labelled.
Sources of data should be acknowledged under each table and chart and fully documented using a
reference list presented at the end of the assignment.
This assessment is to be completed individually and needs to be submitted in CloudDeakin by the due date
and time.
When uploading your assessment, name your document using the following syntax:
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Explanation & Answer:
2000 words




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