Refer to data sheet for both Australia and China that is available on canvas / Assessment task 2.

1. What phase of the business cycle was the Australian economy in in 2019 and in 2020? Briefly explain for each year.

What contribution did the following components of Aggregate Demand; Consumption spending, Investment spending and Net exports make to the cycle in 2019 and in 2020?

Indicators 2017 2018 2019 2020 RGDP % change 2.54 2.65 1.73 -1.1 Inflation rate (%) - GDP deflator 3.55 2.2 3.1 0.5 Consumer Price Index - June Qtr 110.7 113.0 114.8 114.4 Unemployment rate (%) - June Qtr 5.6 5.3 5.2 7.5 Natural rate of unemployment (%) 5 *estimate 4.75 4.5 4.5 Index of production costs / 107.8 109.4 Producer costs of prod'n 111.6 111.2 Labour productivity index 99.7 100.3 99.8 100.2 % change in Consumption 2.51 2.68 1.48 - 5.72% spending estimate Consumer confidence (Index) - June Qtr 97.5 102.1 100.7 93.7 % change in Investment spending (Private Capital Expenditure) 1.3 0.9 - 0.4 - 7.1 Index of Producer / Business 110 confidence 107 104.0 100 Exports (goods & services) ($ millions) 438,312 494,558 432,009 Imports (goods & services) ($ millions) 415,900 424,240 360,685 Net Exports = Xg&s - Mg&s 22,412 70,318 71,324 Exchange rate - USD per AUD; a AUD buys, 30 June .763 .735 697 683 Export price index and (%) change 91.15 98.95 111.5 108.3 16.9% 8.6% 12.7% 2.9% Import price index and (%) change 103.6 110.35 113.25 109.2 0.3% 6.5% 2.6% - 3.6%