Global Economy
Define globalisation.
The increasing integration of economies through trade, investment, finance, and technology.
Name Australia’s largest export partner.
China
Define inflation.
A sustained increase in the general price level of goods and services.
What are the two automatic stabilisers?
Progressive taxation/
Social Welfare
What is the unemployment rate in Australia in Aug 2025?
4.2%
Name one advantage of free trade for developing economies.
Access to larger markets / potential for economic growth / technology transfer.
What is Australia’s most valuable export commodity?
Iron ore
What is the RBA’s target inflation band?
2-3%
Define market failure
When a social cost or benefit is not accounted for by the price mechanism in a market
What is the cash rate target in Australia?
3.60%
Which global institution sets the rules of trade between nations?
World Trade Organization (WTO)
A depreciation of the Australian dollar makes exports (cheaper/more expensive) overseas.
Cheaper
Which type of unemployment occurs when individuals are in between jobs?
Frictional
Name two areas of microeconomic reform in Australia.
Deregulation of financial markets, labour market reform, trade liberalisation, competition policy.
How much was the cash rate changed in April 2025
0.0%
What is comparative advantage?
an economic concept that explains how individuals, businesses, or countries can benefit from specialising in the production of goods or services where they have a lower opportunity cost than others, and then trading with those who have different comparative advantages
What are the components of the Current Account
BOGS (Net goods, net services), NPY, NSY
Give one negative externality of economic growth.
Pollution / resource depletion / climate change.
Describes how monetary policy changes flows through the economy
Transmission mechanism
What is the inflation rate in Australia in August 2025
2.1%
Which two economies are currently the world’s largest by GDP (nominal)?
United States and China.
What are the components of the financial account?
FDI, Portfolio, Derivatives, Reserve assets, Other Investments
What is the formula for the Gini Coefficient
What are the three goals of monetary policy
Full employment, economic prosperity, price stability
What was wage growth in Australia by June 2025
3.4%
What does FDI stand for, and give one example of it in practice.
Foreign Direct Investment – e.g., Toyota building a factory in Thailand.
Name Australia's top 5 import partners.
China, United States, Japan, South Korea, Singapore
What are the 3 criteria for external stability?
Sustainability of external accounts/
Serviceability of foreign liabilities/
Stability of the currency
-$42.1bn
What is Australia's Gini Coefficient
0.34