1. The Reserve Bank is responsible for the determination, implementation and maintenance of monetary policy. Define monetary policy and discuss the current direction of that policy in Australia?

2.

a) Outline how the Reserve Bank of Australia (RBA) would conduct its monetary policy if it was to wish to embark on a tightening of monetary policy? Further, discuss why businesses would react negatively if the RBA was to tighten its policy.

b) What are some of the similarities of funding instruments available to government and that of corporations? (3 marks)