(c) Copyright 2018. King’s Own InstituteTRIMESTER 1, 2018: BUS700 ECONOMICSPaired-Assignment1. General informationAssessment Type: Critical Review – 2500 words report - Team (Pair) Research...

Evaluation of Macroeconomic performance of Australia and USA
Executive summary
The report will endeavour to comprehend the current economic & monetary fiscal condition in Australia by considering & analysing different measures and metrics, and their examination, for example, the country's GDP development rate, contrasted with the Unemployment and inflation rates with the Consumer Price Index (CPI) from Australia, checking it against the conversion standard and exchange rates of the US dollar and its historical statistical value.
The key financial components of the country are talked about alongside their noteworthy developments to have the capacity to recognize patterns and repeating practices which are characteristic of the Business Cycle of Bust and Boom, these are examined to give proposals and make determinations from the monetary conditions on the Reserve Bank of Australia.
The Australian Cash rates are talked about against the US Federal Reserve Rates, these likewise mull over the current and recorded factors, for example, the current lead taken by the United States Federal Reserve System in its Federal Reserve Fund Rates against the Cash rates of the Reserve Bank of Australia which has been kept consistent for almost 19 months in succession. The suggestions given and conclusions drawn are entirely the feelings of the scientist and they are to be utilized just for scholastic understanding purposes.
Table of Contents
1    Executive summary    1
3    Key factors influencing real GDP growth rate (Unemployment rate and inflation rate)    3
4    The Net Exports of Australia with the Forex Rates, a comparison    7
5    Australian Cash rates v/s the US Federal Reserve Fund Rates    10
6    Recommendations & Conclusions    12
7    References    14
Key factors influencing real GDP growth rate (Unemployment rate and inflation rate)
Comparing the real Gross Domestic Product (GDP) growth rate with the unemployment rate, below are shared some of the facts & figures pertaining to the real GDP growth rate & inflation rate and the unemployment rate. The gross domestic product is defined as “A key measure of the value of economic production in the economy. GDP is determined in one of three ways: the value of goods and services produced less the cost of production; the sum of incomes generated by production; the sum of final expenditure on goods and services produced plus exports minus imports. An average of the three approaches may be calculated and is also referred to as GDP.” On the Reserve Bank of Australia website. On comparing the graphs and the tabular information & data one can deduce the existence of a relationship between the real GDP growth rate and the Unemployment rate & the real GDP growth rate and the inflation rate. During the 2009 global financial crisis, the real GDP of Australia fell which may have been caused by the observable rise in the unemployment rates across the country. As one can observe that the fall in unemployment rates had led to rising GDP in the years 2006 & 2007 which also had a moderate inflation rate of 2.3 %. Stability in the real GDP growth rate after the year 2013 is reflective of the effects caused by the stability in unemployment rates and moderate fluctuations in the inflation rates in the period after 2013. There are clear observations of the effects of inflation rates and unemployment rates on the real GDP of Australia. (Reserve Bank of Australia, 2018)
On further analysis and observation of the effects of the real GDP growth rates and the Unemployment rates from the historical statistical data obtained for the years 1999-2017, we can direct our attention towards the similarities in the trends and after effects of the unemployment rate in the Australian real Gross Domestic Product Growth rate. The rise and fall of both the key economic & fiscal indicators during the2009 global economic depression which indicates towards the effects of rise and fall of inflation rates to the real GDP growth rates. The economy really should be supported by the additional and higher sales of exported products. It has also been predicted that the impact of this will be on the non-mining industry where investment has been estimated to grow in the near future due the loose monetary policy which has been implemented by the Government of Australia and the Reserve bank of Australia. This is also in light of the facts that lowering work emplyoyment with needs and the growing amounts of household debt which will gradually continue to burden the economy by pulling it down. The expected growth rates for the real GDP over the next two years have been predicted by experts to be nearly 2.7 %, both in the years 2018 & 2019. (Argy, V.E. and Nevile, J. eds., 2016)
On further contrasting observation of the data we are able to discern the fact that unemployment rates in Australia, which are moderately voilitile with constant fluctuations in them, these fluctatuiions and variations are the result of the economic conditions in Australia aong with its position and play in the global economy and its effects.The lesser consistent pattern observable is between the Consumer Price Indx, a general measure of price inflation for the household sector compiled and published by the Australian Bureau of Statistics, and the corresponding inflation rates and intesrest rates.
The conclusion derived here is that the factors such as a spike or shoor up in the unemployment rate & the net exports between the global markets and Australia triggers variations and changes in the national output which is reflected in the variations in the real GDP growth rate. This ultimately forces the government and the Reserve Bank of Australia to change the interest rates to recover or manage the fluctations to a better degree. Bad investments and capital infusion in various domains and sectors has led to the observed Bust and Boom cycle.
Berument, H. and Froyen, R.T., 2015
    Year
    Historical Consumer Price Index (CPI) - Australia (1999 to 2018)
    Inflation Rate (%)
    Australia’s GDP-real growth rate (%)
    Unemployment rate...