ECONOMICS ATAR COURSE
Unit 4 – Economic policies and management
Economic knowledge and understanding
The aggregate expenditure model
- the components of aggregate expenditure (AE)
- the aggregate demand (AD) curve and factors that can cause movements along and shifts of the AD curve
- demonstrate macroeconomic equilibrium using the AD/AS model
- demonstrate the impact of changes in aggregate demand and aggregate supply on the equilibrium level of income/output using the AD/AS model
- the use of the AD/AS model to explain the business cycle.
Fiscal policy
- the concept of fiscal policy
- the different budget outcomes i.e. balanced, surplus and deficit budgets
- the concepts of expansionary, contractionary and neutral fiscal policy stances
- the impact of different fiscal policy stances on the level of economic activity
- contemporary (the last three years) fiscal policy stances in Australia.
Economic research
- identify research questions to investigate
- apply problem-solving, critical thinking and decision-making strategies to achieve outcomes which may be predictable and contestable by nature.
Reasoning, interpretation and analysis
- identify trends and relationships in economic information and data regarding Australia’s economic policy and management
- use economic information and data to make predictions on Australia’s economic policy and management
- interpret changes in economic data, including prices, unemployment, economic growth, the labour force and productivity
- use macroeconomic models to analyse Australia’s policy stance, including the Keynesian aggregate expenditure model and the aggregate demand and aggregate supply model
- apply economic reasoning to Australia’s economic position and policy mix
- use evidence found in economic information and data to justify a conclusion.
Communication
- select and use appropriate terminology
- select and use appropriate formats when communicating economic understandings
- use economic models to convey economic theory and reasoning about Australia’s policy mix.