Y- 110518- 1146AM- HC1072_Unit_Outline_
This project » ill thro» some light and » ill focus more on these reasons behind this gro» th bj doing a proper analysis of the the GDP rind economic grow th of thc past fii’c ycars Though thcrc ii as a rccession in thc past ; cars of early 1990. still Austral in inanngcd to oi’crcomc that later. mo» ct er. this recent gro» th had outnumbered the past histories. This project i ill reveal the strong gro»’th of thc Australian goi’cmincnt ii’hich ii ill bring about a changc in the economy of the counter as » ell as the gro» th of GDP of the countn .
Gross Domestic Proiluct (GDP} anal Economic Growth
Gross doincstic product or GDP is the total i aluc of monej of all the serf iccs and goods or er a particular tiinc period This GDP includes public consumption. irn’cstincnts in i’arioiis plains or businesscs. cxports and imports and ci’cn prii’atc consumption too Thc calculation of thc GDP is gis en on thc belo» figure:
The above formula depicts GDP as the Gross Domestic Product. C represents the prix’ate Consu •i t ion. G represents the the ExJienditure of the Go› ernment. I represent the Investment of the countn and NX represents the Net Exports of the country that is subtracting
exports from the imports GDP is used to Hurd the comparison of productivity of set eral countries It helps in identifying and also measuring the productis’iti in terms of economic grou th of the county . In order to identify the productivity, this GDP is basically dii ided into tu o parts. These parts include:
a} Nominal GDP
The inflation rate is not at all included in case of nominal GDP, still it helps in increasing the economic grou’th of the county’.
b} Real GDP
The corrected rate which has been rectifies post inflation is taken into account in case of Real GDP,
One of the best procedures to calculate and find the grow th of economy and the lii’ing standard is to take Real GDP into account. This Real GDP basically shows the purchasing port cr of all the
indii’idiials residing in thc countn Thc output gap gii’cs thc diffcrcncc bctii’ccn the difference between the potential GDP and the actual GDP. and can be obtained by subtracting Y* from Y (ix’here Y* is thc potential output and Y is the actual output) If the aboi’c calculation fctchcs a positii’e number. thcn it suggests thnt thc aggrcgatc supply is quite lori cr than that of aggrcgatc demand and this indicates that there is a sudden rise in the inflation Ho» ever, the GDP pcrccntagc is calculated bi subtracting potential GDP from the actual GDP and thc result obtained is divided bj the potential GDP to fetch the final percentage. If the outgap is found to be positii e. then it indicates that there is a high demand, mo» ct er. if the outgap is found to be ncgatix’c. thcn it indicates that therc is a low’ dcmand. Thc real GDP and the pricc lci’cl can be obtained from tlic supply and demand With thc risc in the let eI of pricc, tlicrc is an increasc in thc GDP supply . thus thc output falls.
Froiii the aboi c diagram. LAS reprcscnts long run aggregate supply, » hile SAS reprcscnts the short run supply E rcprcscnts thc cquilibrium lci’cl. AD represents the aggrcgatc demand and Y represents the actual output and Y* represents the potcntial GDP.
There is certain incremcnt of 0.fi perccnt sincc the past quarter »'liile 2.5 pcrcent or er thc past fen ycars in the GDP of Australia It is short ing an incrcasc rcsult in the grow th hoii’ci’cr. there ii ere more expectations from the countn A fen economists from Russia had sum eyed and predicted Australia’s cconoinic grow th to bc G.7 pcrccnt in thc quartcr of Scptcinbcr and an oi’crall thrcc pcrccnt since the past i car Hons ci’cr. in thc last quarter. thc cconoinic grow th of Australia ii as drip en bi both the prim ate and public sectors.
There is an increase in thc actii’iti of both the public infrastructures and prii’ate business ink estineiits across various industries in Australia. This » as due to the reason as tin estinent played a key role in the uplifting of the GDP grow th rate This iin’estment basically had driven the grow th in a much consistent ii’ax hoii’ei’er. in the mid ii’ay. it ii’as flattcred ii’ith a sudden rise of non dii eIIing construction receii ed from tit o LNG platforms of Australia.
The aboi’c graph dcpicts that there is a huge groii’th in bctii ecn the i cars U95-20GG. Hoii’ei’er. there » ere not such sudden steep rise in the later years Moreoi’er. after 2015. it had fallen drasiicallj . after ii hich in recent i cars it is again rising As piiblishcd bi the Australian Biircaii of Statistics (ABS), the GDP figures are obtained below in the gii‘en screenshot. The below table
clearly sho» s thc changc in the adjustcd price of thc Australian GDP, ii’hich in othcr ii’ords kno» ii as the economic gro» th of Australia On an average, there is a gro» th of 3.4 percent of GDP per i car Howci’cr. thc grnph furthcr statcs that there is a dccrcasc of 1.6 pcrccnt of cconomic grow th in the ycar 20G9 But this groii’th »’as a remarkablc as Australia ii’as one of the fe» countries that had shown positive gro» th of GDP in the j ear 2009.
represents the gro» th chart of Australian GDP »'hicIi has been noticed since the past years The numbers slio» n in the aboi e chart are quite significant and also reflecti e
sho» s actually the fluctuation chart of the tlicir GDP Tlic aboi e graph represents the trcnd and scasonalli adjusted fluctuation of the GDP it is prcttj clcar from thc aboi’c chart that thc scasonnlly adjustcd GDP had gonc bcloii zero qintc a numbcr of times in the rcccnt ; cars. Hot e cr. the trcnd had not gone bcvond r.ero since the past jears
Analysis of Australian Government Policies
With the intern ention of the Australian Got cement in achieving a quite a heavy’ number of the outcomcs in thc policy includes in thc iinproi’cincnt of social equity. At thc samc timc. the goi’crnmcnt also trics to address thc sci’cral failures of thc market bi fiirthcr distributing their resources In order to implement their policies the Got ernmeiit of Australia had used one mechanism of direct cxpenditiire. How ei’er. this type of spending has a mcrc add antagc oi’er the mechanisms of policies i hich includes tnx expenditures. loans and guarantees and regulations too. Not in order to make this more clear and transparent. the Australian Government detcrinines the sustainability and distribution and the burdens too. Thc Goi’crnment had also allot ed th ecommunitv to make their Got emments accountable in case of taking any types of ii rong decisions. The more the accountability. the more the Goi’ernment bccoines effectii’c in achiei’ing its objectii’cs
Grow th in real and nominal terms
Thc ini’olx’cmcnt of the Australian goi’crnincnt in thc cconomic actii’ity ini’oli’cs spending as to proiiiote the GDP in taking these measures. it gets t» o benefits parallely Firstly, it helps in proi’iding a good basc for thc much spent tunc in the gro»’th of economy.
Though thci arc not similar to thc dollars . but still it gii’cs an mcaningful comparison bctii’ccn the past years of economy with the present ones. Secondly, the intern ention of the Australian Goveniinent in Australian Economy helps much in the analysatioii of the social science.
Grow th in policy ilecisions
lii tlic recent years thc gro» th had rcflected much both in tlic increment of various incasures of policics and also thc incasures of the cost Sincc the announccmcnt of the total numbcr of dccisions ii hich also include sai’ings and tax incasurcs. the goi’emincnt of Austral in had made an enormous improi emcnt in the dccision making policy As seen in Figure 8. the nuinbcr of measiircs iakcn by thc Australian Goi’crnmcnt is increasing gradually ycars aficr ycars.
As per thc policics and decisions taLcn bi thc Australian Goi’crnmcnt. thc bcloii statistics reflects the grow th rate of the real GDP of Australia from the j ear 2012 till 2017 ii ith the rise in thc projections till the i car 2G22. It is clearly sccn from the below’ graph. that Australia had grow n on an ai’cragc of 2.27 pcrccnt in thc past ycars
One of the primary’ and foremost indicators to determine the economic grow th of a countn is the GDP. It helps in detcnnining the health and state of thc cconomy of thc county’.
With the steady increase in the GDP, the Australian Goveniineiit had made a steady mod e in their unemployment rate The goi’crnment had ii orkcd hard in adjusting the uneinploi incnt ratc and fixed the same at 5.5 percent in the month of March of 201S. The economy of Australia had becn able to add almost 500G jobs and in rcturn the unemployment numbcr also drastically reduced to almost 25G0. This ratc of iinemploi ment ii as at an ai’erage of 0.88 per cent since the years l'77S till the year 201S. thereby reaching at an altitude of 11.20 percent in the month of December l'992 This had literally recorded a decrease or loci of 4 percent in thc month of Februay’ of 2008.
In the month of March, these figures had reduced by two thousand four hundred. The number had reduced to seven lakh thirty thousand two hundred only. However, the ones who were looking for a full time work had increased the number by nine thousand three hundred. This number had reduced to five lakh twenty two thousand four hundred only. While the ones who were hunting for only part-time work had reduced by eleven thousand seven hundred. The number had reduced to Mo lakh seven thousand eight hundred only.
The Australian Got ernmeiit had taken certain steps to increase in the number of employ ment bj almost four thousand ninc hundred and this number had increased to one crore tit ents four lakh eighty four thousand one hundred. That ii as an enormous gigantic increase in the figures. Hoii’ei’cr. the part tune cmploi ment had got incrcascd to tii’enti four thousand eight hundred and the total figure had risen to thirty nine lakh and sci’entj thousand Thcrc is a sudden dccreasc in the number of full time employment which ii as nineteen thousand nine hundred and it resulted the total number to go doii’n to eighth fii’e laLh fourtecn thousand onc hundred only
The participation rate of the labour force had stepped do» n to fi5.5 percent from 65.6 percent in a singlc month and this resulted in thc cxpcctntion ii’hich ii as a slight inorc ii’hich ii as assiiincd to 65.7 pcrcent Ho» ci er, the a erage monthly i orking hours of all the jobs got incrcased to 4.5 million hours (almost 0.26 percent) to 1.740 4 million hours In thc mcantimc. thc ratio of cinploymcnt to population got much stccpcr to 61.9 pcrccnt that is hat ii’as curlier at 62.G pcrccnt Gro»’th of the Industries
The gcntlc risc in thc grow th if Australian cconoiny is basically the rcsult of thc grow th of the industries » here thc major scctors includes the serf icc sectors and the mining sectors Ho» ever, the export of iron ore is also increasing rapidly in the counts' ii hich also increases tlic grow th of thc industrics across Australia Sincc the countn ’s annual groii’th had risen to thrcc pcrccnt. hence the performance of the economy’ is also rising in the Australian territories. Moreover, the supply and demand had partlj affectcd the Grow th of GDP of the whole county’ Most importantly . thcrc is a high irn’oli’emcnt of the consumers and thc goi’emment which basically influences economic activity of
The main reason for the growth of these industries in Australia is that thc Australian goi’crnment had ii orLed endlessly in reducing the number of unemployment throughout the countir which as a result boosted the industrialists to grow and expand their business across the country . This in
turn also hclpcd th@n to incrcasc thcir infrastructures and thus rcsultcd in cxporting machineries across the globe. While expanding the same across the globe, the industrialists had also enriched thT1nscli’cs ii hich hclped them to incrcasc in thc number of thc cmploi mcnt across thc country . Thc mining industn’ has also pla; cd a huge role in this dci clopincnt As a result. the oi’crnll GDP of the country got increased and made the uneinploj ment rate stable also
Lastlj . the serx’icc scctors also pla; cd a significant rolc in the dci clopincnt of the countn Thc economy of Australia had increased since the tin old ement of the soft» are industn in the county . These industries basically get set eral projects from outside the countn too. Both the prii’ate scctors and the public scctors had playcd a significant rolc b; drii’ing thc cconoiny of thc county cxtensii eIj . This also liclps in outsourcing » hich as a rcsult makes a gentle economic grow th of thc countn’. Risc in thc ratc of consumption along ii ith falling rate of sax’ings from 5.3% to 4 0% show’s that unsiablc drop in the rate of sai’ings requires robust iinproi’cincnt.
Since the upliftinent of the economic gro» th of Australia, the Got emment had played a significant rolc in increasing thcir domestic GDP, hcncc as a result. it is rccommcndcd for thGln to maintain this grow th all round thc ycars ii’hich »’ill cnablc them to lcad from other countries in the upcoming days As seen in Figure 8, it is pretty clear that there is high increase in the number of mcasnres across thc country ii’hich has bccn scan sincc thc 2012. How ci’cr. if the; can continue to gi e this tj pe of effons in the upcoming days, then they can easilj achie e the numbers mentioned in Figure S
This project had highlighted the essential measures in order to increase the GDP and economy growth of Australia Morcoi’cr. the bndgct process had also proi’idcd a robust analj sis of thc spending proposals proposed by the Australian Goi’cmincnt This project had highlighted thc demand graph as » ell as the growth of GDP till the recent j ears The fluctuation chart of GDP had also bccn analyscd »’ith the toial numbcr of measures iakcn bj the goi’crnmcnt. Lastl; . the actions taken bj the Australian Got emment in order to increase the economic gro» th of the county is also highlighted.
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