Personal Learning Journal 2 – written due week 11, oral due week 12 Refer to the Overview of the most recent Reserve Bank of Australia Monetary Statements. See www.rba.gov.au >publications>; as well...

ECONOMICS
Table of Contents
Answer to Question 1    3
Answer to Question 2    3
Answer to Question 3    4
References    5
Answer to Question 1
The Australian reserve bank is one of the recognised organisations in Australia. The interest rate of the bank affects the entire growth of GDP and itself affected by the rate of real GDP of the nation. It has been observed by the revival resource that the organisation cut off its interest rate by 0.75 %. However, the cash rate of the organisation is determined by 1.5% that affects the entire rate of GDP in the country. The rate of real GDP is being affected by it and this affects the spending power of people in the country. According to the financial requirements, the Australian bank should reduce its interest rate as it ensures the economic growth of the nation. As opined by Finlay and Price (2015), the rate of real GDP increases according to the rate of interest provided by the central bank of the nation. The lower rate of interest reduces the cost of borrowing and that affect the disposable income of the people of Australia. However, the rate of disposable income increases if the rate of interest reduced and that help to increase the purchasing power of common people. According to Rees, Smith and Hall (2016), it affects the entire rate of GDP and it helps to secure the economic growth of the country.
Answer to Question 2
It has been found that all kinds of business are going through several stages of the business cycle and it affects the rate of GDP in the nation. According to the present trend of business, the reserve bank of Australia is in the recovery stage of the business cycle where the higher authorities constantly focused on the entire factors that should recover for the better assumption of economic growth. According to Jorda,...