Question 1 (10 Marks)

In your presentation, critically analyze the policies undertaken by the government of Australia and the RBA. Also, show the impact of these policies on the following: a. unemployment; b. inflation; c. Output level

Question 2

The Australian Government introduced the Job Keeper Payment to help low-income workers find jobs and support businesses affected by the significant economic impact of the COVID-19 pandemic. This payment has implications for the Australian government's expenditures. Suppose we have the following information about our economy: All amounts are in millions of dollars. C = 800 + 0.8 Yd T0 =400 I0 = 600 G = 1,000 Yfe = 15,000 a. What is the current equilibrium level of income in this economy?

b. Calculate the size of the output gap. Draw an AE diagram illustrating the current economic situation

c. Suppose the government wants to close the output gap by changing government spending (via Job Keepers Payment). How much does government spending need to increase or decrease for the economy to achieve full employment?

d. Now suppose the government decides to close the output gap by changing taxes. By how much do taxes need to increase or decrease for the economy to achieve full employment?

Question 3

The Reserve Bank of Australia (RBA) made four consecutive cash rate increases in May-August 2022 in response to rising inflation. If the RBA wants to alter the cash rate, it will engage in open market operations.

a. Draw the flow chart step by step and draw the effect of these open market operations on the overnight money market.

b. What is the impact of changes in the cash rate on other interest rates?

Note: You must provide the correct citation and reference for authentic sources used in evaluating SBR reporting in Australia. And references are needed at the end to support the answer. Proper diagrams where needed and need two thousand words must. Only answer if you can give two thousand words. And answer All the parts of questions