Purpose:
To enable students to research, critically analyse and evaluate the macroeconomic performance of Australia. This assessment contributes to Learning Outcomes (a) and (c).

Topic: Evaluation of Macroeconomic performance of Australia and USA.

Task Details:

Students will complete a research-based analysis and evaluation of the macroeconomic performance of Australia and USA from 1985 to 2015/16.

Question

Some financial market commentators often assert that changes in USA's real GDP have the tendency of causing recessions and expansions in Australia, because Australia trades with the USA and its economy is small relative to the economy of USA. Do you agree or disagree with this assertion? Critically discuss.

To answer the question, obtain Australian and USA data from 1985 - 2015/16 on real GDP growth rates, yearly exchange rate movement, net exports (NX) growth rates, interest rates (i.e. Australia's Cash rate and US' Fed funds rate).

Produce appropriate statistical tables and pair-wise graphs of each series (e.g. cash rate vs Fed funds rate) and critically analyse and discuss their relationships to reach your conclusion.

In your discussion, provide plausible economic explanations, including the impact of fiscal and monetary policy in both countries, for the relationships among the series.

3. Research requirements, presentation and source of data

Research requirements: Students need to support their analysis with a minimum of 10 academic journal articles plus the text. Students aiming for a Credit or higher grade will need to use more sources. Articles should be relevant and recent. Non-academic journal sources may also be used, but relevant and validity should be clarified with the lecturer/tutor.

Presentation: Report format - 2500 words report - in Word.doc or .docx format

Title page, executive summary, table of contents, appropriate headings and sub-headings, recommendations/findings/conclusions, in-text referencing and reference list (Harvard - Anglia style), attachments if relevant. Single spaced, font Times New Roman 12pt, Calibri 11pt or Arial 10pt.

4. Other information to note

This assignment is paired-assignment and students must form a pair (2 people) for the assignment. One person or more than two-people assignment will not be accepted, unless permission is granted by lecturer for special circumstances.

Names and ID numbers of students in the group must be clearly printed on the Assignment Cover Sheet. A member, who has not contributed to the discussion and assignment, must be marked as "Not contributed" in a bracket following the student's name and ID.

You must follow an appropriate format explained below. Not following appropriate format will cause a loss of some marks.
- All analytical contents must be clearly typed and printed. Hand-written report will NOT be accepted.
- Appropriate heading or sub-title of each section must be typed and used.
- You must analyse, explain and show how and why you draw your conclusion.
- You must also draw and include appropriate and relevant graphs and tables together in your explanation. Draw them using Microsoft Power Point/Word/Excel, NOT hand- drawn.