1. Analyse the concept of a nation’s balance of payments to examine the economic importance of changes in a nation’s net foreign wealth position.
2. Synthesize and evaluate theories of exchange rate determination.
3. Assess the policy options available in an open macroeconomic environment.
4. Evaluate the extent to which macroeconomic policy effectiveness is affected by macroeconomic openness.
5. Assess the implications of a government’s choice between a fixed and a floating exchange rate regime.
6. Analyse the causes and effects of currency crises.
Task: You are a graduate employee at an international economics think tank called the “AussieGlobal Analytics” and you have been asked to provide research on the COVID 19 recession and policy response in two countries that have strong trade relationships. You need to select two countries: Australia and its trading partner.
Specifically, you have been asked to
1. Provide the overview and the assessment of the impact of pandemics on the economy in the two countries. Show the strong trade link between the two countries and the effect of Covid on the trade and capital flows.
2. Evaluate the effectiveness of Covid Policies on the Macroeconomy in both countries.
3. You are also asked to examine the macroeconomic interdependencies between Australia and its trading partner. From your findings what can you deduce about the economic recovery, as we move into 2022?
4. Discuss the role of trade and capital flows for the effectiveness of the policy in two countries. Keeping the HBR article in mind assess what reduced globalisation of trade due to pandemic will mean for the policy effectiveness and economic recovery. Is there a role for cryptocurrency and the digital economy in the pandemic recovery?