From Table 2 Collect for Jun-1975 to Jun-2020: General government ; Final consumption expenditure: Chain volume measures ; G Households ; Final consumption expenditure: Chain volume measures ; C Private ; Gross fixed capital formation: Chain volume measures ; Planned Investment IP Public ; Gross fixed capital formation: Chain volume measures ; Government Investment IP G Changes in inventories: Chain volume measures ; inv Exports of goods and services: Chain volume measures ; X Imports of goods and services: Chain volume measures ; M Statistical discrepancy (E): Chain volume measures ; SD GROSS DOMESTIC PRODUCT: Chain volume measures ; GDP Note that: These are all real figures as Chain volume measures = real Real GDP: GDP = C + IP + I P G + inv + G + X - M + SD Real Aggregate Expenditure AE = GDP - inv = C + IP + IP G + G + X - M + SD a. Produce a Table showing the annual percentage change in each component of GDP (C, I P , I P G, inv, G, X , M, SD, AE and GDP for June 2018 to June 2019 and June 2019 to June 2020. (20 marks) b. Compare the % change in Aggregate Expenditure (AE) and the % change in real production (real GDP). Why did inventories fall from June 2018 to June 2019 and June 2019 to June 2020? (10 marks) c. Using your figures from a and b, what was the effect of four months of Covid from March 2020 to June 2020 on the Australian economy performance in the 2019-20 financial year and growth from 2018-19 to 2019-20? Which components of GDP contributed to the change? (20 marks) BEA121 ECONOMIC POLICY IN ACTION - Assignment 1 - Macroeconomics University of Tasmania - CRICOS PROVIDER CODE 00586B 5 Qu.3 Australian Keynesian Model 70 marks Using the same initial data from Question 2, before beginning the question perform the following calculations. 1. Calculate the annual change (from one June year figure from the previous) in Real Consumption Expenditure and in real GDP in $Millions, from 1976 to 2020. 2. Use each year's annual change in consumption and GDP to calculate the marginal propensity to consume (MPC) for each year. t. 3. Calculate the annual change (from one June year figure from the previous) in $Millions in Real Imports from 1976 to 2019 (leave out 2020). u. 4. Use each year's annual change in imports and GDP to calculate the marginal propensity to import (MPI) for each year. v. 5. Calculate the average of the MPC over June 1976 to June 2019 and the average of the MPI over June 1976 to June 2019. Use these estimates of the MPC and MPI in answering the questions below. a. Use the long-run averages to calculate the size of the Open Economy Multiplier 1 1+ [Marks are included for showing calculations including the 5 steps above. (Possibly in an appendix if calculations are from a spreadsheet)]. (20 marks) b. Calculate the change in Government Consumption and Government Capital Expenditure from June 2019 to June 2020. In the absence of any other changes (ceteris paribus), what does the open economy Keynesian model suggest that the change in real GDP should as a result of the increase in Government spending. Compare it to the actual change in real GDP from 2019 to 2020. By how much must have other total expenditure decreased in order for this result to hold? (20 marks) c. If other total expenditure decreased by the amount you calculated above, by how much have total autonomous spending fallen by? (10 marks) d. What else may have occurred that resulted in the government spending not having its full Keynesian Multiplier Effect? (20 marks)