MACRO1 (ECON1010) Assignment 1
(Chapter 28, 26&27 Principles of Economics or Chapters 9,7 & 8 Principles of Macroeconomics )
Submit online at the ‘Assessment Task’ in Blackboard
Due: 11:59PM on 10 September (Sunday)
Tutorial Time and Day: _______________________________________________________________________________________________
Student Name: ________________________________________________________________________________________________________
Student ID: _____________________________________________________________________________________________________________
This assignment covers the following topics:
- Unemployment (Chapter 28 or Chapter 9)
- Productivity and Growth (Chapter 26 or Chapter 7)
- Saving, Investment and Financial System (Chapter 27 or Chapter 8)
READ THE FOLLOWING FIRST (Very Important)
- This assignment contributes to 20% of the overall marks for the course.
- Only a single submission permitted (hence, please ensure to attach the file version of the assignment)
- Use and Submit this template only for your submission (i.e., write down your answers in the space provided in each question and submit) – any other form of the file is NOT accepted (Failing to do so will automatically mean zero mark for this task).
- If you do not have a word processor installed in your home computer, follow this link and in “APPS” you can use a Microsoft word processor; http://www1.rmit.edu.au/students/mydesktop
- The recommended browsers when uploading the file are Chrome, Firefox or Explorer (some have suggested that Safari might not work well).
- The font size has to be at least 12.
- Explain your answers, but be succinct.
- Label each axis and explain the diagram that you use carefully (if any).
- Show all of your working in order to get partial credits.
- After the due date any late submission will be marked as ‘late’. A penalty of 10% of the allocated marks (i.e., 2 marks) per day will apply for late submissions.
- A failure of your home computer (or any kind of the IT problem) cannot be a reason for the late submission (all requests for an extension of this nature will be rejected immediately).
- Make sure you have included your student ID and name in the front page of the assignment
- Working with other fellow students is strongly encouraged. However, you cannot just copy your friend’s answers. If we find out this, you will be harshly punished for the academic plagiarism. See ‘students responsibilities’ at RMIT’s policy on this:
Short Answer Questions:
- Consider a closed economy in which GDP equals $20 billion, consumption equals $13 billion, government purchases equal $3 billon and tax revenue equals $1 billion. Use this information to answer the following questions: (3 marks)
- What is private savings equal to in this economy? (0.5 mark)
- What is public savings equal to in this economy? (0.5 mark)
- How would the level of public savings impact the supply of loanable funds? (0.5 mark)
- What is national saving equal to in this economy? (0.5 mark)
- What are net exports equal to in this economy? (0.5 mark)
- What is investment equal to in this economy? (0.5 marks)
- Explain how labour productivity is determined. In your answer address why human capital is considered to be so vital to lifting labour productivity levels. To illustrate your understanding provide an example. Your answer should be between ½ page and a full page. (4 marks)
- Watch the Gapminder video ‘200 Years that Changed the World’ available from http://www.gapminder.org/videos/200-years-that-changed-the-world/ and answer the following questions:
- When Hans Rosling talks about China ‘catching up’ with the United States, explain in more detail what he means by this? Your answer should be around ¼ of a page. (1.5 marks)
- How can free trade help middle income countries or emerging economies ‘catch up’ with the high income or developed economies? Your answer should be ½ a page and include a relevant example. (2 marks)
- On the y-axis of the visualisation Hans Rosling presents in the Gapminder video, income per person is shown. What is an alternative label or term that we have used in the course that means the same as income per person? (0.5 mark)
- The income per person referred to in part c. above is ‘inflation adjusted’. Why is it necessary to adjust this for inflation? Your answer a should be no longer that ¼ of a page (1 mark)
- Read the recent report released by the Foundation for Young Australians The New Work Order: Ensuring young Australians have skills and experience for the jobs of the future, not the past. Available online: file://ntapprdfs01n02.rmit.internal/eh2/E10092/https—www.fya.org.au-wp-content-uploads-2015-08-fya-future-of-work-report-final-lr.pdf or via https://www.fya.org.au/our-research/#report-downloads )
Having read the Report answer the following questions:
- The report identifies one the forces shaping the future as automation. Discuss how automation may impact unemployment in years to come. In your discussion be sure to identify the type(s) of unemployment it may lead to and comment on what policy makers can do to address this. Your answer should be around ½ a page. (3 marks)
- Globalisation is a dominant economic force that creates new opportunities but also presents some challenges. Provide an example from Australia of an industry or sector of the economy that has suffered job losses as a result of globalisation. In your answer explain why globalisation can create unemployment in some industries or sectors of a national economy. Your answer should be around ½ a page. (3 marks
- Comment on something you have found interesting from reading the Report (that differs from your answers in parts a and b). Your answer should be in one long or two shorter paragraphs. (2 marks)