HSC Economics Student Booklet

CHELTENHAM GIRLS HIGH SCHOOL
SOCIAL SCIENCES FACULTY
ECONOMICS
HSC STUDENT BOOKLET 2017
1
HSC Course Structure
The HSC course focuses on the management of an economy and is therefore essentially
macroeconomic in nature. It examines the external framework in which the Australian economy
operates. The course investigates the impact of the global economy on the Australian economy
and the link between economic issues and the management of an economy, with specific
reference to the Australian economy.
Higher School Certificate Course % of course Indicative

120 indicative hours time Hours
1 The Global Economy 25 30
2 Australias Place in the Global Economy 25 30
3 Economic Issues 25 30
4 Economic Policies and Management 25 30
The order of the topics in both the Preliminary and HSC courses is not prescriptive and may be
influenced by economic events, the interests and needs of the students or the availability of
resources.
Assessment Components and Weightings

The mandatory components and weightings for the HSC course are set out below. The internal
assessment mark submitted to the Board of Studies is to be based on the HSC course only.
Component Weighting
Knowledge and understanding of course content 40
Stimulus based skills 20
Inquiry and research 20
Communication of economic information, ideas and issues in appropriate forms 20
100
No more than 50% weighting may be allocated to tests & examinations.
Teachers may use their discretion in determining the manner in which they allocate tasks within
the course content. The Board considers that 3 to 5 assessment tasks is sufficient.
Reporting achievement at the HSC

The Higher School Certificate credentials received by students are used by the Board to report both
the internal and external measures of achievement. Higher School Certificate results in Economics
comprise:
an assessment mark derived from the mark submitted by the school and produced in accordance
with the Boards requirements for the internal assessment program
an examination mark derived from the HSC external examination
an HSC mark, which is the average of the assessment mark and the examination mark
a performance band, determined by the HSC mark.
Student performance in an HSC course is reported against standards on a course report. The course
report contains a performance scale for the course describing levels (bands) of achievement, an HSC
mark located on the performance scale, an assessment mark and an examination mark.
My Assessment Record
Student Number:
2
Students should keep a copy of their results in all assessment tasks so that these marks may be
verified against the marks recorded in the Social Sciences Faculty mark book. Therefore students
are to complete the following table by transferring a record of the marks they received in each
component of the Assessment Schedule for Year 12 HSC Economics.
Task Task Type Outcomes Task My Marks My Rank My

Number Tested Weighting in the Cumulativ
% Task e Rank
1 In class extended H1, H3, H4,
response with H9, H10,
research element H12 20%
2 OR & SA Qs on H1, H2, H3,

Topics 1&2 H4, H8,
H10, H11 15%
3 Research & H1, H5, H6,
Report H7, H8, H9,
H10, H12 30%
4 Trial HSC H1, H2, H3,
Examination H4, H5, H6,
H7, H8, 35%
H10, H11
3
Objectives and Outcomes
Table of Objectives and Outcomes
Objectives HSC Outcomes

A student will develop A student:
knowledge and
understanding about:
the economic behaviour of H1 demonstrates understanding of economic terms, concepts
individuals, firms, and relationships
institutions and
governments
H2 analyses the economic role of individuals, firms, institutions
and governments
the function and operation H3 explains the role of markets within the global economy
of markets
the operation and H4 analyses the impact of global markets on the Australian and
management of global economies
economies
H5 discusses policy options for dealing with problems and
issues in contemporary and hypothetical contexts
H6 analyses the impact of economic policies in theoretical and
contemporary Australian contexts
contemporary economic H7 evaluates the consequences of contemporary economic
problems and issues problems and issues on individuals, firms and governments
facing individuals, firms
and governments
A student develops A student:
skills to:
investigate and engage in H8 applies appropriate terminology, concepts and theories in
effective analysis, contemporary and hypothetical economic contexts
synthesis and evaluation
of economic information H9 selects and organises information from a variety of sources
from a variety of sources for relevance and reliability
communicate economic H10 communicates economic information, ideas and issues in

information, ideas and appropriate forms
issues in appropriate forms
H11 applies mathematical concepts in economic contexts
H12 works independently and in groups to achieve appropriate

goals in set timelines
4
Important Websites & Content Information for Economics
Students
Economics students are expected to be aware of current events in both the domestic & global
economy. It is not enough to know the theory, you must be able to APPLY this theory & illustrate
your response with current, real world examples.
It is important to prepare for Economics examinations by learning & remembering some basic data
that can be used in answering short answer questions but especially for integration into extended
response questions. Data can be used to support an argument about the theory that helps to
explain or analyse current global & domestic economic conditions.
Reading the NEWSPAPER is vital for Economics students. The Sydney Morning Herald is
probably the best choice.
Important Web sites:

Newspapers/Journals:
www.smh.com.au Read the SMH - can do it online, app for iphones & iPads available as well.
www.rossgittins.com All Ross Gittins articles & speeches, with key words as to the content.
www.afr.com.au Australian Financial Review
www.economist.com A periodical (Journal) that is regularly updated, it provides articles on

current economic events from around the world.
Content based websites:
www.keystoneeconomics.com free subscription website, analyses key events from newspapers

& links them to syllabus outcomes
www.ubs.com/hsceconomics An outstanding website, written for the NSW HSC syllabus.

Podcasts of key concepts, study hints, China Case study.
Statistics & current domestic & global information websites:
www.rba.gov.au Reserve Bank of Australia, Monetary Policy Statements, current statistics on

a range of issues such as exchange rate, TWI, cash rate, inflation rate &
other domestic & global interest rates.
www.abs.gov.au excellent statistics on trade, economic growth & labour force
Revision & preparation website:
www.bos.nsw.edu.au Invaluable site for looking at the Notes from the Marking Centre. These
should be read in conjunction with the exam paper & the marking
guidelines.
5
10 Content: Economics HSC Course
10.1 HSC Topic One The Global Economy
25% of indicative time

The focus of this study is the operation of the global economy and the impact of globalisation on
individual economies.
Outcomes
A student:
H1 demonstrates understanding of economic terms, concepts and relationships
H2 analyses the economic role of individuals, firms, institutions and governments
H3 explains the role of markets within the global economy
H4 analyses the impact of global markets on the Australian and global economies
H5 discusses policy options for dealing with problems and issues in contemporary and
hypothetical contexts
H6 analyses the impact of economic policies in theoretical and contemporary Australian
contexts
H7 evaluates the consequences of contemporary economic problems and issues on
individuals, firms and governments
H8 applies appropriate terminology, concepts and theories in contemporary and hypothetical
economic contexts
H9 selects and organises information from a variety of sources for relevance and reliability
H10 communicates economic information, ideas and issues in appropriate forms
H12 works independently and in groups to achieve appropriate goals in set timelines.
Content
Students learn to:
Examine economic issues

examine the effects of globalisation on economic growth and the quality of life, levels of
unemployment, rates of inflation and external stability
assess the potential impact on the environment of continuing world economic development
investigate the global distribution of income and wealth
assess the consequences of an unequal distribution of global income and wealth
discuss the effects of protectionist policies on the global economy
Apply economic skills

analyse statistics on trade and financial flows to determine the nature and extent of global
interdependence
assess the impact on the global economy of international organisations and contemporary
trading bloc agreements
evaluate the impact of development strategies used in a range of contemporary and
hypothetical situations.
6
Students learn about:
International economic integration

the global economy
Gross World Product
globalisation
trade in goods and services
financial flows
investment and transnational corporations
technology, transport and communication
international division of labour, migration
the international and regional business cycles
Trade, financial flows and foreign investment

the basis of free trade its advantages and disadvantages
role of international organisations WTO, IMF, World Bank, United Nations, OECD
influence of government economic forums G20, G7/8
trading blocs, monetary unions and free trade agreements
advantages and disadvantages of multilateral (EU, APEC, NAFTEA, ASEAN) and bilateral
agreements
Protection
reasons for protection infant industry argument, domestic employment, dumping, defence
methods of protection and the effects of protectionist policies on the domestic and global
economy tariffs, subsidies, quotas, local content rules, export incentives
Globalisation and economic development

differences between economic growth and economic development
distribution of income and wealth
income and quality of life indicators
developing economies, emerging economies, advanced economies
reasons for differences between nations
effects of globalisation
trade, investment and transnational corporations
environmental sustainability
the international business cycle.
Case study
Undertake a case study of the influence of globalisation on an economy other than Australia,
including an evaluation of the strategies used to promote economic growth and development in
this economy.
7
10.2 HSC Topic Two Australias Place in the Global Economy

The focus of this topic is an examination of Australias place in the global economy and the effect
of changes in the global economy on Australia.
Outcomes
A student:
H5 discusses policy options for dealing with problems and issues in contemporary and
hypothetical contexts
H7 evaluates the consequences of contemporary economic problems and issues on
individuals, firms and governments
H8 applies appropriate terminology, concepts and theories in contemporary and hypothetical
economic contexts
Content
Students learn to:

assess the impact of recent changes in the global economy on Australias trade and financial
flows
examine the effects of changes in trade and financial flows on Australias economic
performance
analyse the effects of changes in the value of the Australian dollar on the Australian economy
discuss the impact of free trade and protection policies on the quality of life in Australia
propose likely changes to the structure of industry within Australia as a result of current trends
in the global economy

calculate the main components of Australias balance of payments
analyse the relationship between the balance of the capital and financial account and the net
income balance
explain the relationship between the current account balance and the balance of the capital
and financial account
use supply and demand diagrams to explain how the value of a currency is determined
under different exchange rate systems
analyse the impact of changes in the components of the balance of payments on the value
of the Australian dollar
8
Australias trade and financial flows
Value, composition and direction of Australias trade and financial flows

trends in Australias trade pattern
trends in financial flows debt and equity
Australias Balance of Payments

structure
Current Account, debits and credits
Capital and Financial Account
links between key Balance of Payments categories
trends in the size and composition of Australias Balance of Payments
international competitiveness, terms of trade, international borrowing, foreign investment
effects of these trends on Australias Balance of Payments
Exchange rates
measurement of relative exchange rates
to other individual currencies
Trade Weighted Index
factors affecting the demand for and supply of Australian dollars
changes in exchange rates appreciation/depreciation
determination of exchange rates including fixed, flexible and managed rates
the influence of the Reserve Bank of Australia on exchange rates
the effects of fluctuations in exchange rates on the Australian economy
Free trade and protection

Australias policies regarding free trade and protection
Australias multilateral and bilateral free trade agreements (overview of two examples of
each type of agreement)
the implications of Australias policies for individuals, firms and governments
implications for Australia of protectionist policies of other countries and trading blocs.
9
10.3 HSC Topic Three Economic Issues
The focus of this topic is the nature, causes and consequences of the economic issues and
problems that can confront contemporary economies.
Outcomes
A student:
H7 evaluates the consequences of contemporary economic problems and issues on individuals,
firms and governments
Content
Students learn to:

examine the arguments for and against increasing economic growth rates
investigate the economic and social problems created by unemployment
analyse the effects of inflation on an economy
discuss the effect of a continued current account deficit on an economy
investigate recent trends in the distribution of income in Australia and identify the impact of
specific economic policies on this distribution
analyse the economic and social costs of inequality in the distribution of income
examine the economic issues associated with the goal of ecologically sustainable
development

identify and analyse problems facing contemporary and hypothetical economies
calculate an equilibrium position for an economy using leakages and injections
determine the impact of the (simple) multiplier effect on national income
explain the implications of the multiplier for fluctuations in the level of economic activity in an
economy
calculate the unemployment rate and the participation rate using labour force statistics
interpret a Lorenz curve and a Gini coefficient for the distribution of income in an economy
use economic concepts to analyse a contemporary environmental issue
assess the key problems and issues facing the Australian economy.
10
Economic issues in the Australian economy
Economic growth
aggregate demand and its components: Y = C+I+G+XM
injections and withdrawals (I+G+X; S+T+M)
the simple multiplier: k = 1/(1MPC)
measurement of growth through changes in real Gross Domestic Product
sources and effects of economic growth in Australia
increases in aggregate supply improvements in efficiency and technology
trends in business cycle
Unemployment
measurement
labour force
participation rate
unemployment rate
trends
types and causes
cyclical
structural
frictional
seasonal
underemployment
hidden
long term
non-accelerating inflation rate of unemployment (NAIRU)
main groups affected by unemployment
effects of unemployment economic and social costs
Inflation
measurement headline and underlying
trends
causes
demand inflation
cost inflation
imported inflation
inflationary expectations
positive and negative effects
External stability
measurement
Current Account Deficit (CAD) as a percentage of Gross Domestic Product
net foreign debt as a percentage of Gross Domestic Product
net foreign liabilities as a percentage of Gross Domestic Product
terms of trade
exchange rate
international competitiveness
trends
11
positive and negative causes and effects
Distribution of income and wealth
measurement Lorenz curve and Gini coefficient
sources of income as a percentage of household income
taxation, transfer payments and other assistance
sources of wealth
dimensions and trends, according to gender, age, occupation, ethnic background and family
structure
economic and social costs and benefits of inequality
Environmental sustainability
ecologically sustainable development
private and social costs and benefits externalities, market failure
public and private goods free riders
environmental issues:
preservation of natural environments
pollution, climate change
depletion of renewable and non-renewable resources.
12
10.4 HSC Topic Four Economic Policies and Management
This topic focuses on the aims and operation of economic policies in the Australian economy and
hypothetical situations.
Outcomes
A student:
H5 discusses alternative policy options for dealing with problems and issues in contemporary
and hypothetical contexts
H6 analyses the impact of economic policies in theoretical and contemporary Australian contexts
H7 evaluates the consequences of contemporary economic problems and issues on individuals,
firms and governments
Content
Students learn to:

analyse the opportunity cost of government decisions in addressing specific economic
problems or issues
investigate structural changes in the Australian economy resulting from microeconomic
policies
apply economic theory to explain how a government could address an economic problem or
issue in hypothetical situations
analyse alternative ways to finance a budget deficit

explain how governments are restricted in their ability to simultaneously achieve economic
objectives
use (simple) multiplier analysis to explain how governments can solve economic problems
identify limitations of the effectiveness of economic policies
explain the impact of key economic policies on an economy
propose and evaluate alternative policies to address an economic problem in hypothetical and
the contemporary Australian contexts
explain, using economic theory, the general effects of macroeconomic and microeconomic
policies on an economy
select an appropriate policy mix to address a specific economic problem.
13
Economic objectives in relation to:

economic growth and quality of life
full employment
price stability
external stability
environmental sustainability
distribution of income
Potential conflicts among objectives
Macroeconomic policies
rationale for macroeconomic policies stabilisation and shifts in aggregate demand
Fiscal policy
Federal Government budgets and budget outcomes
effects of budgetary changes on resource use, income distribution and economic activity
methods of financing deficits
use of a surplus
Monetary policy
purpose of monetary policy
implementation of monetary policy by the Reserve Bank of Australia
impact of changes in interest rates on economic activity and the exchange rate
Microeconomic policies
rationale for microeconomic policies including shifts in aggregate supply, efficiency
effects of microeconomic policies on individual product and factor markets, individual
industries and the economy
regulation and deregulation competition policy
Labour market policies

role of national and state systems
the national system for determining
minimum employment standards
minimum wages
awards
enterprise agreements
employment contracts for high income earners
dispute resolution
arguments for and against the use of centralised, decentralised and individualised methods of
determining employment contracts
education, training and employment programs
National and global context for environmental management

regulations
market-based policies
targets
international agreements
14
Limitations of economic policies
time lags
global influences
political constraints
Policy responses and their effects in dealing with the economic objectives
economic growth and quality of life
full employment
price stability
external stability
distribution of income
environmental sustainability.
15
CALCULATIONS IN ECONOMICS
TOPIC 1
CHANGES IN REAL GROSS DOMESTIC PRODUCT & REAL GDP PER CAPITA
The real growth rate is measured by:
Real GDP in given year real GDP in previous year 100

Real GDP in previous year 1
The real GDP per capital is simply
Total real GDP

Total population
MEASUREMENT OF ECONOMIC GROWTH (also TOPIC 3)
Economic growth is measured by the rate of change in real Gross Domestic Product (real GDP). If
nominal (money) GDP was used this could be misleading because the increase from one year to
the next may be the result of a change in prices. Therefore economists correct nominal GDP for
inflation before calculating the percentage change in real GDP.
Real GDP is also referred to as GDP at constant prices, whereas money (nominal) GDP is also
referred to as GDP at current prices
Real GDP = Money GDP CPI in base year

CPI in given year
TOPIC 2
STRUCTURE OF THE BOP
The BOP is a systematic record of all transactions between Australia & the rest of the world over a
period of time. The BOP is made up of 2 accounts: The Current Account & the Capital & Financial
Account.
The Current Account
Goods credits (X) Goods debits (M) = Net goods
Service credits (X) Service credits (M) = Net services
Net goods + Net services= Balance on Goods & Services (BOGS)
Primary Income credits Primary Income debits = Net Primary Income
Secondary Income credits Secondary income debits = Net Secondary income
Balance on the Current Account = BOGS + Net Primary Income + Net Secondary Income
16
The Capital & Financial Account
Capital transfer credits Capital Transfer debits = Balance on the Capital Account
Net Direct Investment inflow + Net Portfolio Investment inflow + Net Other Investment
inflow + Net Change in Reserve Assets = Balance on Financial Account
Balance on the Capital & Financial Account = Balance on the Capital Account + Balance on
the Financial Account.
Balance of Payments = Current Account + Capital & Financial Account + Net Errors & Omissions = 0
Basically a DEFICIT in ONE account must be offset by a SURPLUS in the OTHER account
TERMS OF TRADE (Calculation not needed in new syllabus)
The terms of trade (ToT) is the ratio of export prices to import prices & is calculated as follows:
Export price index 100

Import price index 1
NET FOREIGN LIABILITIES
Net Foreign Liabilities = Net foreign debt (Loans/ what is owed) + Net foreign equity (owned)
TOPIC 3
AGGREGATE DEMAND & ITS COMPONENTS
Aggregate demand is the total value of spending or demand in an economy. This includes:
C Consumer demand for goods & services
I the demand by business firms for capital goods
G Government spending on goods & services, including infrastructure
(X-M) Net exports, or the difference between exports & imports, to measure the net overseas
demand of goods & services
AD = C + I + G + (X-M)
LEAKAGES & INJECTIONS
An economy is in equilibrium if leakages = injections. If leakages are greater than injection the
economy will be contracting & it leakages are less than injections the economy will be expanding.
(Leakages) S + T + M (Injections) I + G + X
Leakages < Injections = Economy EXPANDING
Leakages > Injections = Economy CONTRACTING
Also look at Budget outcome - G > T , therefore a Deficit (Contractionary)

G < T , therefore a Surplus (Expansionary)
G = T., therefore balanced (Neutral)
17
THE SIMPLE MULTIPLIER
MPC = that part of each extra dollar of income that is spent Change in Consumption
Change in Income
MPS = that part of each extra dollar of income that is saved Change in Savings
Change in Income
MPC + MPS = 1
Simple or Income Multiplier = 1 1

1 MPC or MPS
Change in Equilibrium level of Y (Y) = change in injection multiplier (k)
LABOURFORCE (WORKFORCE)
Working full-time + working part-time + unemployed (but actively seeking work)
LABOURFORCE PARTICIPATION RATE (LFPR)
LFPR = Labour force 100

Working age population 1
UNEMPLOYMENT RATE
U/E = Total number of officially unemployed 100

Labour force 1
INFLATION RATE
In Australia the inflation rate is measured by the rate of change in the Consumer Price Index (CPI).
Current CPI Previous years CPI 100
Previous years CPI 1
To calculate the importance of a particular item in contributing to the inflation rate:
Weighting difference between 100 & CPI figure
18
HSC Topic 1 - THE GLOBAL ECONOMY
Glossary of Terms
TERM DEFINITION
APEC APEC is the Asia - Pacific Economic Co-operation Forum. It was mainly
formed in response to the development of trading blocs such as the EU. It
aims to promote co-operation among nations.
ASEAN The Association of Southeast Asian Nations is an organisation of nations

from that region, which has agreed to free trade among member countries.
Australia-United AUSFTA is a preferential trade agreement between Australia and the USA
States Free Trade which began in 2005. It is not a completely free trade agreement as there
Agreement are still many restrictions especially in agriculture.
(AUSFTA)
Bank bills A bank bill generally arises from a short-term credit arrangement designed to
enable businesses to obtain funds to finance commercial transactions. The
bills are accepted by the bank that endorses them.
Bond market The market for existing government securities.
Cash rate The equilibrium interest rate in the market for exchange settlement funds,
also referred to as the money market. The cash rate is targeted by the
Reserve Bank through market operations.
Central Bank A bank whose functions are:

To have sole control over the issue of currency and usually also to control
the nation's reserves of gold and foreign exchange;
To act as banker to the central government and to the banking system;
To advise and assist the central government on financial and monetary
matters;
To implement officially determined monetary policy by regulating the
monetary and banking system.
CERTA CERTA is a bilateral (between 2 countries) trading agreement, between

Australia and New Zealand. The Closer Economic Relations Trading
Agreement has led to the elimination of tariffs and other quantitative
restrictions on trade between Australia and NZ.
Commonwealth A Commonwealth government security is originally issued as a means to

government finance a budget deficit. It is a form of borrowing where by the Australian
security Government agrees to pay the holder a fixed some of money over a period
of time and pays the face value of the security on maturity. They include
treasury notes and government bonds.
Credit The lending of money to another party. It involves an agreement to repay the
temporary loan.
Debt Whatever is owed, be it money, goods, or services, by one person or
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organisation to another.
Derivatives Derivates are simple financial contracts whose value is linked to or derived
from an underlying asset, such as stocks, bonds, commodities, loans and
exchange rates. They are international financial instruments for spreading
risk or hedging. They include: futures, options, swaps, forward rate
agreements and other hedging instruments.
Development Economic Development is the physical situation and the state of mind
whereby a society through some combination of social, economic and
institutional processes secures the means to obtain a better life.
Emerging These are economies than are in transition from low to middle income
economies economies to high income economies as a result of opening their markets
and high levels of economic growth.
Equities market The share market. The rights (shares) to partial ownership of companies are
bought and sold.
European Union The EU was formed out of the European Community (EC) in 1993. It has 27
(EU) member countries, including Britain, Germany and France. There are free
trade, capital and labour movements among member countries. Thirteen EU
members adopt the EURO as a common currency. They make-up the Euro
Area.
Financial The development of new financial products and methods of borrowing and
innovation lending.
Financial An organisation that takes money from households or firms and lends it to
Intermediaries other households or firms.
Foreign currency A foreign exchange swap is similar to a repurchase agreement, except they
swaps involve the exchange of cash for foreign currency. To increase liquidity the
Reserve Bank will swap Australian currency for foreign currency. This will
increase the supply of Australian currency in the money market. The foreign
currency swap will then be reversed at a set time and a set price in the
future. The opposite happens if the Reserve Bank wants to reduce liquidity.
Foreign exchange The market in which the currencies of different countries are exchanged for
market one another.
Futures market The market where agreements are made, that commodities and other
products will be bought or sold at a later date, at a fixed price, determined at
the time that the contract is agreed to.
G7/8 The Group of Eight (G8), and formerly the G7 of Group of Seven is a forum,
created by France in 1975, for governments of the six major countries in the
world: France, Germany, Italy, Japan, The United Kingdom and the United
States. In 1976, Canada joined the group (thus creating the G7). In
becoming the G8, the group added Russia in 1997. In addition, the
European Union is represented within the G8, but cannot host or chair it.
The G8 heads of government meet at their annual summit to discuss and
implement international policies.
20
G20 The Group of Twenty (G20) Finance Ministers and Central Bank Governors.
This was established in 1999 to bring together important industrialised and
developing economies to discuss key issues in the global economy. The
G20 is made up of 19 of the main countries in the world plus the European
Union. Australia is a member of the G20.
Global economy The Global economy is the world economy. It is the economic activity going
on in the world. It includes all production, trade, financial flows, investment,
technology, labour and economic behaviour in nations and between nations.
Globalisation Globalisation is the actual movement, the capacity to move and the potential
movement across nations of trade, investment, technology, finance and
labour. It also involves the effects of these forces.
Gross World This is the value of the worlds output, also known as World Real GDP. It is
Product the aggregate of individual nations outputs.
Human The HDI is part of the Human Development Report. It is a measure of

Development human development that includes, measurements that reflect: a long and
Index (HDI) healthy life, access to knowledge and a decent standard of living.
International The IMF is the International Monetary Fund. It was set up along with the
Monetary Fund World Bank after World War II to aid and stabilise International Capital
(IMF) Markets. The IMF was responsible for monitoring and stabilising the
international financial system through the short - term financing of balance of
payments deficits.
Liquidity The degree to which an asset can be instantly converted into cash at a
known price.
Market operations Reserve Bank activity in the money market, in implementing monetary
policy, through targeting the cash rate.
NAFTA The North America Free Trade Agreement is an agreement signed in 1992
by Canada, the USA and Mexico to create a trade free zone between these
3 countries.
Physical Quality of The PQLI was developed as an alternative and improved measurement of
Life Index living standards, at the end of the 1970s. The index included three basic
indicators:
Life expectancy at age1.
Infant mortality.
Literacy.
Purchasing Power This measure compares the relative prices of products in different countries.
Parity The relative value of each county's currency depends on the quantity of
goods and services that can be purchased with it. PPP can be measured in
absolute terms or relative terms.
Quality of life The general living standard a person has.
21
Real interest rate The nominal interest rate adjusted to compensate for inflation.
Repurchase A repurchase agreement is an agreement, between the Reserve Bank and a

agreements bank, that the Reserve Bank buys or sells a security on the understanding
that the dealers agree to repurchase or sell the security at a specified date
and at an agreed price. It is used to cover temporary fluctuations in the
supply of cash. This is the most common form of transaction in the cash
market.
Reserve Bank Australia's Central Bank. The Reserve Bank is responsible for maintaining
the stability of the financial system. Financial stability is an essential
ingredient in maintaining macro-economic stability and the confidence of the
community in undertaking their financial transactions. Within this broad
mandate, the Bank also has specific responsibility for the safety and
efficiency of the payments system, a responsibility overseen by the
Payments System Board
Share market The market for equities. Shares are bought and sold, which gives claim to
the partial ownership of a company.
Sovereign Debt Government debt, also known as public debt or national debt. It usually
relates to bonds or debt that are in a foreign currency.
Terms of trade The terms of trade is the ratio of a nation's export price to their import price.
When the terms of trade improves (increased export prices relative to import
prices) a nation is better off, as it can buy more imports with the same level
of exports. A worsening of the terms of trade means a nation must sell more
exports to purchase the same quantity of imports.
Transnational A TNC is a company that operates in more than one country. It generally has
corporation (TNC) subsidiaries or branches in a number of countries.
World Bank The World Bank is an international financial institution. The main function of
the World Bank is to promote growth and prosperity by providing long-term
loans for investment.
World Trade The main group promoting free trade in the world economy. It grew out of
Organisation (WTO) GATT in the 1990's.
HSC Topic 2 - AUSTRALIA'S PLACE IN THE GLOBAL ECONOMY
Glossary of Terms
TERM DEFINITION
Appreciation A rise in the free-market exchange rate of the domestic currency with
foreign currencies.
Balance of A complete statement of all transactions between one country and the rest
Payments of the world in any specific period.
Bilateral trade A trading agreement between 2 countries eg ANZCER,

agreement
22
Capital account The record of all financial transactions involving Australian claims on and
liabilities to foreigners.
Capital flight The sudden withdrawal of funds from a country.
Current account A record of receipts from the sale of goods and services to foreigners, the
payments for goods and services bought from foreigners, and property
income (such as interest and profits) and current transfers (such as gifts)
received from and paid to foreigners.
Depreciation A fall in the free-market exchange rate of the domestic currency with
foreign currencies.
Effective rate of The effective rate of protection of an industry is defined as the percentage
protection by which all of a nations trade barriers raised the industrys value added,
per unit of output.
Export propensity Export propensity measures the proportion of goods produced domestically
that are exported.
Financial account The record of all transactions in financial assets and liabilities between
Australians and foreigners.
Fixed exchange An exchange rate that is pegged by the country's central bank.
rate
Foreign Debt There are two measurements of the Foreign or External Debt. They are:-
Gross Foreign Debt, ie the total borrowings by Australian residents from
non-residents.
Net Foreign Debt, ie the Gross Debt minus Australias holdings of foreign
reserves, and gold, and lending Australian residents have made overseas.
Foreign exchange The market in which the currencies of different countries are exchanged for
market one another. It is also known as the FOREX market.
Import penetration Import penetration measures the proportion of goods sold domestically that
are imported.
International The price and non-price advantages an industry or country has over
competitiveness foreign competitors.
J Curve The effect of a currency devaluation on the balance of goods and services.
It generally applies in a fixed exchange rate system.
Managed float Actions of the central bank to intervene in the foreign exchange market to
influence the value of the currency.
Multilateral Trade This a trading agreements between many nations at one time such as
Agreement through the WTO or APEC.
Net Foreign A nations total foreign liabilities (financial obligations) minus total foreign
Liabilities assets.
23
Nominal rate of The numerical value of the actual rate of protection listed by a country. It
protection generally relates to the level of a tariff.
Primary Income Net primary income is the difference between income received from
overseas and income paid overseas, such as royalties, dividends, and
interest on money owed (foreign debt)
Real interest rate The nominal interest rate adjusted to compensate for inflation.
Secondary Income This involves money transfers between countries, e.g. foreign aid, and
sending money to relatives overseas.
Structural change The larger and more lasting adjustments which occur in the structure of
production in the economy; for example, changes in the relative size and
characteristics of industries.
Terms of trade The terms of trade is the ratio of a nation's export price to their import price.
When the terms of trade improves (increased export prices relative to
import prices) a nation is better off, as it can buy more imports with the
same level of exports. A worsening of the terms of trade means a nation
must sell more exports to purchase the same quantity of imports.
Trade Weighted A weighted average exchange rate expressed as an index, where the value
Index of the index is 100 in a specific base year. This is the main measurement of
Australia's exchange rate compared to its main trading partners.
W curve The effects of a currency depreciation followed by an appreciation in a

floating exchange rate system.
HSC Topic 3 - ECONOMIC ISSUES
Glossary of Terms
TERM DEFINITION
Aggregate The total demand for goods and services generated by the sum of all
demand spending in the economy. A basic proposition of economic analysis is that
the level of production, employment, and income are determined by the level
of total spending on final goods and services. Y=C+I+G+X-M
Australian Fair Did set and adjust Federal minimum pay levels in Australia. It has been
Pay Commission replaced by Fair Work Australia.
AWA Australian Workplace Agreement now abolished
Award These are minimum wages and working conditions legislated by the
government or an industrial tribunal (see Fair Pay Commission).
CPI In Australia, inflation is measured by the Consumer Price Index (CPI). This is
the price of a basket of the normal goods and services people buy in
Australia.
24
Cyclical Unemployment arising from a slowdown in the pace of economic expansion
unemployment or aggregate demand.
Direct investment Equity investment in Australia by non-residents.
Ecologically This is a process where industrial development is accompanied by

sustainable preservation of the environment.
development
Enterprise An agreement reached through enterprise bargaining that states the working
agreement conditions in that enterprise, industry or business.
Enterprise The process of negotiation between employers and employees (and or

bargaining unions) in regard to industrial relations issues, such as wages and
conditions.
Externalities Costs or benefits of production or consumption that affect society, but not
necessarily the producers or consumers of the product.
Fair Work Act Sets out the conditions of workplace relations in Australia.
2009
Fair Work It is the national workplace relations tribunal. It is an independent body with
Australia power to carry out a range of functions relating to: the safety net of minimum
wages & employment conditions, enterprise bargaining, industrial action,
dispute resolution, termination of employment and other workplace matters.
Free rider Someone who consumes a product without paying for it.
Frictional Unemployment arising from new entrants into the labour market and those
unemployment workers waiting to start a new job.
Gini coefficient The area between the Lorenz curve and the 45 degree line divided by the
total area under the 45 degree line. It is a measurement of income equality.
The larger the gini coefficient the larger is the level of income inequality.
Hardcore The unemployed who find it difficult to get and keep jobs because of
unemployment physical, mental or social reasons.
Hidden Unemployment represented by discouraged workers and not included in

unemployment published unemployment statistics.
Human capital Human capital is the value of a persons education, skills and experience.
Implicit Price A type of price index. As an example, the implicit price deflator for Gross
Deflator Domestic Product is calculated by comparing movements in GPD in current
prices and constant prices.
Income Income is the flow of earnings received by an individual and includes

sources such as wages, salaries, commissions, dividends, interest and rent.
Industrial dispute A dispute or disagreement in the work place that causes a stoppage of work.
These disputes often relate to managerial policy, wages, physical working
conditions and hours of work.
Industrial relations Industrial relations commissions or tribunals are agencies that historically
commission have been set up by the federal or state governments to consider issues
25
such as industrial dispute resolution, award determination and enterprise
agreement registration.
Inflationary An expectation of the inflationary cycle based on the argument that once
expectations high rates of inflation come to be expected, inflation will be maintained over
a period of time. Inflation becomes built into the system.
Injections Injections equal investment plus government expenditure plus expenditure

on exports.
Kyoto Protocol This is an international treaty on climate change assigning emission targets
aimed at reducing greenhouse emissions.
Labour force The total number of available workers in an economy, at a particular time.
The labour force may be classified according to those in various types of
employment and those unemployed, but actively seeking work. Also known
as the workforce.
Labour force The labour force underutilisation rate represents the underutilisation of
underutilisation labour within the labour force and is the sum of the unemployment and
rate underemployment rates.
Long-term The long-term unemployed are the unemployed that have been out of work
unemployment for more than 12 months.
Lorenz curve A curve showing the proportion of national income earned by a particular
percentage of the population (measured from the poorest upwards).
Mobility of labour The ease with which labour can be transferred from one occupation to
another or from one geographical location to another.
Multiplier effect An initial change in aggregate demand leads to an eventual change in

national income that is greater than the initial change. It is equal to 1 divided
by 1- MPC.
NAIRU The NAIRU is the non-accelerating inflation rate of unemployment, also

referred to as the natural rate of unemployment. It is the level of
unemployment that can be sustained at a set period of time without having
major inflationary effects.
Natural Rate of The natural rate of unemployment, often referred to as the NAIRU (non-
Unemployment accelerating inflation rate of unemployment), is the long run rate of
unemployment a nation can sustain.
Non-wage Benefits from working that are not related to wages, such as
outcomes superannuation, sick leave and holidays.
Participation rate The proportion of the working age population, 15-65 years old, recorded as
either in work or looking for work.
Part-time work Work less than a normal working week. This is often considered to be less
than 35 hours a week.
Portfolio Purchases by companies and individuals of shares and debentures issued

investment by Australian and overseas companies.
26
Private goods Goods that someone or a group owns. Some people are excluded from
using it usually as a result of price.
Public goods Goods or services that can be consumed by everyone and from which no
one can be excluded, eg defense.
Seasonal Unemployment occurring in industries or regions where the demand for

unemployment labour is lower at certain times of the year.
Structural Unemployment that arises from changes in the pattern of demand or supply
unemployment in the economy.
Unemployment The number of workers who are part of the labour force and are not
employed but are actively seeking employment.
Unemployment Unemployment expressed as a percentage of the labour force.

rate
Wealth Wealth is the stock of assets owned by an individual and includes items
such as shares, bank deposits, superannuation, houses and land.
Withdrawals Incomes of households or firms that are not directly put back into spending.
Withdrawals equal net savings plus net taxes plus import expenditure.
HSC Topic 4 - ECONOMIC POLICIES AND MANAGEMENT
Glossary of Terms
TERM DEFINITION
Accrual Accrual budgeting represents international best practice in public sector

Aggregates financial management and reporting. The main advantage of accrual
measures (as opposed to cash) is that they provide a more comprehensive
indication of the total activity of government and the long-term effects of
current policy.
Anti-competitive Behaviour that reduces the level of competition in the market.

conduct
Australian An independent statutory authority, the Commission administers the Trade
Competition and Practices Act 1974 and the Prices Surveillance Act 1983 and has additional
Consumer responsibilities under other legislation. The Commission is the only national
Commission agency dealing generally with competition matters and the only agency with
responsibility for enforcement of the Trade Practices Act and the associated
State/Territory application legislation.
Automatic A mechanism that decreases the size of fluctuations in the level of spending
stabilisers in the economy. For example when the economy expands, government
spending on welfare is reduced and tax revenue will increase. Import
expenditure and savings also follow this pattern as automatic stabilisers.
Budget outcome The budget result. The difference between revenue and expenses. It is also
known as the fiscal balance.
27
Capital gains tax A tax levied on increases in value of a capital asset, such as shares or real
estate.
Cash rate The equilibrium interest rate in the market for exchange settlement funds,
also referred to as the money market. The cash rate is targeted by the
Reserve Bank through market operations. It is the interest rate on unsecured
overnight loans between banks
Commonwealth A Commonwealth government security is originally issued as a means to
Government finance a budget deficit. It is a form of borrowing where by the Australian
security Government agrees to pay the holder a fixed some of money over a period
of time and pays the face value of the security on maturity. They include
treasury notes and government bonds.
Corporatisation A government business enterprise that remains in government ownership,
but its management structure is altered so that it operates like a privately
owned enterprise.
Cyclical The changes in the budget outcome as a result of changes in the level of
component of the economic activity.
budget
Deficit budget Estimates of expenses are greater than estimates of revenue.
Fiscal balance The fiscal balance is the accrual equivalent of the underlying cash balance.
A fiscal surplus indicates that the Government is saving more than enough
to finance all of its investment spending.
Fringe benefits tax A tax on businesses for payments, usually in kind, made to employees over
and above wages and salaries. Fringe benefits such as a company car, or
an expense account, or payment of superannuation premiums are provided
in order to attract and hold staff, and for motivation purpose.
Goods and A tax on goods and services. It is a regressive tax.

services tax
Government The plan of expected expenses and revenue of the government, usually for
budget the next fiscal year.
Government Businesses owned by the government.

business
enterprises
Headline cash This is the actual change in the size of government expenses and revenue,
balance including changes in assets and liabilities. A larger headline surplus allows
debt repayment.
Impact of a tax The impact of a tax refers to the point at which it is imposed initially. In the
case of an excise duty, the impact of the tax is on the manufacturer; the
incidence of the tax, however, may be on the final consumer.
Incidence of a tax The final resting place of a tax is called the incident of the tax.
Income tax The tax on income or the part of income liable to tax. It is determined by
deducting from accessible income (gross income) all allowable deductions.
Indirect tax These are taxes paid on goods and services that have been purchased. The
tax is included in the purchase price.
28
Labour market Policies that effect the operation of the labour market.
policies
Marginal tax rate The extra tax paid as a proportion of the change in income received. It is
calculated by dividing the change in tax by the change in income.
Microeconomic The attempt to increase output from given inputs of labour, capital, and
reform materials by increasing efficiency.
Monetary policy The attempt to control inflation and promote economic stability and to
moderate the business cycle by changing the quantity of money in
circulation and adjusting interest rates.
National Debt The national or public debt is the net liabilities of Australian governments.
Phillips Curve Shows the relationship between the inflation rate and the unemployment
rate.
Prices and Policies designed to influence the level of prices and incomes. The most
incomes policy common ones are wages policies.
Privatisation The process of selling a public corporation to private shareholders.
Progressive tax A tax whose rate (marginal tax rate) increases as the amount of taxable
income increases, eg personal income tax.
Proportional tax A tax whose rate (marginal tax rate) remains the same regardless of the
amount of taxable income.
Public sector That sector of the economy, which is owned and directly controlled by the
government. It includes both government and semi-government bodies.
Regressive tax A tax, which takes a smaller proportion of income as taxable income
increases.
Relative poverty This is calculated as a proportion of average earnings. People living below
this level are said to be in relative poverty, in comparison to the other people
in that nation. They lack the basic necessities in relation to the general
standard of living in a country.
Repurchase A repurchase agreement is an agreement, between the Reserve Bank and a

agreements bank, that the Reserve Bank buys or sells a security on the understanding
that the dealers agree to repurchase or sell the security at a specified date
and at an agreed price. It is used to cover temporary fluctuations in the
supply of cash. This is the most common form of transaction in the cash
market.
Safety net A minimum guaranteed standard of wages and working conditions.
Social cost Costs which do not appear in the account of a firm; eg. the cost to the
community and individual of noise, air pollution and traffic congestion. The
29
cost is borne by non-producers and non-consumers of the product.
Structural change Larger and more lasting adjustments which occur in the structure of
production in the economy; for example, changes in the relative sizes and
characteristics of industries.
Structural The budget outcome if the economy was at full employment. This relates to
component of the the effects of changes in policy on the budget outcome, as distinct from
budget changes in the level of GDP (cyclical component).
Surplus budget An excess of government revenue over government expenses. T is greater

than G.
Tax efficiency The taxation system should not cause inefficient resource allocation.
Tax threshold The starting point where the tax is charged. This is generally the income
level that is first subject to the tax.
Time lags The time it takes for something to have an effect.
Trade policy Policies that are designed to effect trade. They may favour free trade or be
protectionist.
Trade Practices The objective of the trade practices act is to enhance the welfare of
Act Australians through the promotion of competition and fair trading and
provision for consumer protection. The Act covers anti-competitive and
unfair market practices, mergers or acquisitions of companies, product
safety/liability, and third party access to facilities of national significance.
Underlying cash This the most accurate measure of the government's budget funding
balance requirements in a particular year. Over the long term it will equal the fiscal
balance.
30
WRITING AN ECONOMICS EXTENDED RESPONSE.
These extended response guidelines are intended for use in not only examinations, but for
assessment tasks and class work situations as well.
Introduction
You can't write a good extended response unless you know and understand the facts.
How do you learn the facts and gain understanding? - You do this by:
participating in lessons by being an active learner and engaging with the words & lesson
content
completing all the class exercises
wider reading (especially the newspapers) and note-taking following the syllabus, to deepen
knowledge
regularly setting aside study time
analysing simple questions.
How are extended responses judged?
The criteria are: facts, information presented (content plus detail)

relevance of facts to the question (make sure to answer the question being asked & NOT
just a dump of information)
interpretation of material (argument) and depth of understanding (displayed) of topic
structure of essay (logic and coherence)
writing style (clear, precise English, use of paragraphs)
Types of essay pinpoint the instruction words
1. Give an account of Describe ...

To narrate, to present information (exposition)
2. Account for Why give reasons for Explain What caused

This is not a narrative of events. It requires you to say why a particular event occurred. You
must base your answer on facts and evidence but the main emphasis is on argument and
interpretation.
3. Analyse Examine Assess Evaluate

Consider the various elements of a subject (both positive & negative). Try to show inter-
relationships between elements; judge elements.
4. Discuss Do you agree

Often appear after quotations. They expect you to present the different aspects of a subject.
You may discuss varying interpretations but you are expected to have a point of view and to
argue in support of your case.
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5. To what extent
The statement may not be true or only partly true. You must determine how important this
aspect is in relation to others.
6. Compare Contrast
Examine characteristics of subject to demonstrate similarities and differences.
7. What were the effects

Examine the consequences of an event or action
8. Two part questions: How and why What were /how effective
Often combine presentation of information and interpretation. Balance is importance here.
Some key points to keep in mind

In most extended response questions you are expected to:
argue and interpret
present a point of view. (You can briefly include points of view to demonstrate you are
aware of them.)
base your arguments on specific evidence not on assertion or generalisation.
have a balance. All parts of a question should be dealt with.
Pre-steps to extended response writing
1. Analysing questions
a. Highlight & follow the directive term make sure you understand what is involved in
answering the directive term
b. Underline key terms - check limits imposed by question
c. Think about where in the syllabus the question comes from
d. If it is a stimulus question think about what clues it gives you in developing your response
2. Extended Response planning

This is an important skill to develop. It can be a very good study and revision technique.
Read a selection of questions on a topic, choose an extended response; plan an answer. If
you are dissatisfied with your plan then you don't know the material and must re-study it
from this angle. If you have fully studied a topic, all an extended response does is ask you
to re-arrange and order your knowledge to see it from the perspective of the question and to
use examples and illustrations to support your response and to demonstrate your
knowledge of current economic issues in the Global and/or Australian economy.
A good plan helps you do this logically.
a. List in logical order, all major points to be discussed - these will form the basis of your
paragraph divisions.
b. List supporting points which are developments, explanations, extensions or qualifications

of the major points.
c. List examples, quotations, statistics, etc which you will use to support your argument. Do
it clearly. Do not use full sentences. It's important to acknowledge your quotes.
32
Check your plan to see that points are in a logical order. For a 45 minute extended
response this should take 5-7 minutes. It is time well spent. It is the thinking part of your
extended response (essay).
If you know your material you can practice the technique until you can respond quickly.
3. Extended Response structure
a. Introduction or lead in
Usually no more than 10-15 lines. It is your direct general answer to the question. It makes
your answer relevant to the question. It outlines the general theme which you will develop.
Write a thoughtful, enticing and accurate introduction It makes a first impression on the
marker & first impressions count it is the way of introducing the marker to what YOU are
going to say in your extended response. You need to show that you can answer the
question, that you have good knowledge of the current economic environment and that you
can use economic terms & concepts. Define key terms from the question in the intro
It should not be so general as to just restate the question - it presents your point of view. It
should introduce any important qualifications or distinctions you intend to consider. Writing
sample introductions is also a good revision technique. Once you have written an
extended response plan (as previously), write the introduction to that extended response.
Practice this and you develop confidence in your ability to start an extended
response effectively.
b. Body of the Essay - paragraphing

Each paragraph should introduce one major element of your answer. Each major idea
should be fully explained, developed and supported otherwise it remains as a
generalisation or assertion. If an idea is particularly complicated it may require more than
one paragraph. The important thing is to avoid cramming lots of different ideas into the one
paragraph.
If all paragraphs are very short your essay will probably a series of disjointed points rather
than a coherent argument. There should be a natural transition (a link) from one paragraph
to another.
A paragraph plan is shown below:
Generalisation - this does not always have to be the first sentence.
Explanation, qualification, elaboration
Examples, illustrations, quotations, evidence, facts, statistics
Diagrams may be included in your response but if they are to ADD value to the response
they must be correctly drawn & fully labelled & be referred to in the body of your response
BEFORE they are drawn use them to illustrate a point or concept.
c. Conclusion or summing up
There should not be merely a restatement of the question. It should not be merely a
33
restatement of the introduction. It should not begin "In conclusion, to sum upetc."
It should serve a summarising function and should draw together various strands of your
argument.
Be careful that the conclusion does not weaken the extended response by saying
something at variance with the arguments advanced in the body of the extended response.
Some general considerations
Content
1. To write a top band response your response MUST illustrate MORE THAN an
understanding of the theory. You must relate your answer to what is currently occurring in
the Australian & global economy.
2. Support the economic theory with reference to current policy, relevant & accurate statistics,
recent examples & quotes (if possible) about what is currently happening.
Length
1. Quality is more important than length
2. For most HSC questions you need to write about 4 pages to be able to discuss a question
in sufficient depth. If you cannot now write 4 pages in 40 minutes, start practicing. You can
develop your physical writing speed. Set aside 10 minutes each night at the end of your
study schedule. Write a summary of something you have studied. Try to increase the
amount you write each week. It is like training for a 100 m sprint. (Some students can write
six pages for each essay, although it also depends on the size of the writing.)
Spelling
1. Bad spelling will irritate. All Economic terms must be correctly spelt & correctly defined.
2. You should know how to spell regularly used words, proper names, etc.
3. Have vocabulary lists.
Style
1. Write clear, simple English. Do not try to dress up your ideas in fancy prose or pretentious
phrases.
2. Clarity is the most important criterion.
Grammar
1. Minor technical matters are not important but there must be no ambiguity.
2. Check that each sentence is a complete sentence.
34
3. This is a formal piece of writing so do not write in the 1st person do not use we, they, I,
you, their, us etc
Legibility
1. If there is ambiguity about any of your letters, change your writing style now.
2. A clear writing style ensures your answer can be read.
A poor writing style will annoy an examiner and could lead you to be given a lesser mark
than you deserve simply because the examiner cannot read your response. You may know
exactly what you are talking about, but the examiner won't know this because she/he can't
read what you have written. Remember, response could be marked at 9.00 pm after a hard
evening's marking. Don't make it more difficult for the examiner than you have to.
Timing
1. Time Management is very important. Stick to the time allowed for each extended response.
2. Use any extra time to check for silly mistakes
Something to end on
Extended Response writing comes easy to some students, they are lucky because they have a
natural talent.
For many students it is a skill that can be developed if that is their clearly stated goal.
35
SENTENCE STARTERS
EMPHASIS WORDS
A way to say that a particular idea or detail is especially important.
Important to note Remember that

Most of all A major event
A significant factor The chief factor
A primary concern Should be noted
A key feature The principal item
Essentially Especially when
ADDITIONAL WORDS

These show that your thoughts are going to continue in the same direction or sequence.

First Last of all
First of all Granted that
Following that Furthermore
Moreover In addition
Also As well as
Another point Initially
Likewise Afterwards
Finally

CHANGE OF DIRECTION WORDS

These prepare for a change in direction of your thoughts

However Alternatively
Even though Although
In contrast While
Nevertheless Even so
Yet Whereas
Despite Still
On the other hand Instead
Regardless Differs from

GIVING EXAMPLES/ILLUSTRATIVE WORDS

Words used to tell, show or depict a situation in an attempt to make the idea clear

Such as For example
Specifically These include
To elucidate This illustrates
For instance is one such
36
as in
Furthermore
CONCLUSION WORDS
To alert the reader to the fact that you are about to write the last & possibly most important
words.
Consequently Therefore
Last of all Since
As a result For this reason
Thus
37

LINKING WORDS
As an extended response is supposed to be a logically ordered presentation of ideas, you

must make sure your ideas flow on from each other. Using linking words is one way of
doing this
AND / THEN BUT / IF BECAUSE

also however so
too even so therefore
as well as though / although insofar as
further / beyond except for these reasons
furthermore albeit consequently
firstly, secondly, etc until / unless presumably
next nevertheless thus
later in spite of / despite this as a result / results in
for instance / example notwithstanding under these
circumstances
another alternatively in respect of
similarly conversely considering
of course rather than leads / tends to
moreover on the contrary obviously
including / excluding on the other hand naturally
subsequently this / that is not to say evidently
while / whilst of course enables
following whereas usually
correspondingly while / whilst invariably
equally admittedly eventually
in summary eitheror in that case
finally neithernor now, if one considers
in conclusion at the same time once
in the meantime regardless probably
meanwhile incidentally certainly
now on the proviso that in general
KEY WORD SCAFFOLDS
Outline what is it about / general
information
When you outline, you will need to provide:

General information about the topic
Big picture information
Question
38
Point 1
Point 2
Point 3

..

..

..

..

..
Outline what is it about / general
information
When you outline, you will need to provide:

General information about the topic
Big picture information
39
Question
Outline the features of Facebook.
Opening statement about your response

Facebook is a social media site.
Point 1 - Communication
Allows communication between individuals, groups and communities
Point 2 Medium for Sharing

Provides a medium for family and friends to share photos and experiences.
Point 3 - Security
It allows people to share personal information in a safe manner when security settings
are set
40
Explain to provide a reason why or how,
or the impact, or a series of statement in a
sequential order
When you explain, you will need to show:
Question how things work, and
how or why things have
come to be the way they
are.
Opening statement about your response / Define your
link between
How something the cause
works.
topic
and effect
What it is/ used
impact
for?
What each part does.
Point 1 (paragraph 1) How the parts work together.
How to use it.
Description OR
something happens.
Why
How and why it starts
What happens next, why?
What happens after that, why?
What happens
A description finally, why?
is a statement that
Effect / impact / reason / why / how provides characteristics /
information about the topic.
Words that show

Example cause/effect/reason/why/how
Point 2 (paragraph 2) Because
Since as
Description
Therefore
Consequently
As a result
For this reason
Subsequently
That is to say, in other
Effect / impact / reason / why / how
words
This means
A conclusion involves 1 2
Example sentences linking your points back
to the question.
Point 3 (paragraph 3) Words and Phrases for a
Description conclusion
For the reasons above
In conclusion
In other words
As you can see
Undoubtedly
To sum up
In summary
In short
Without question
Example
Conclusion sum up your response, link back to the
question
41
Explain to provide a reason why or how or
Question the impact,
Explain the effect of Facebook features. or a series
Opening statement about your response / Define your of
topic statement
Facebook is a social media site aimed at connecting
people together. in a
Point 1 (paragraph 1) - Communication sequential
Description order
Allows communication between individuals, groups and
communities by posting events on their timelines or inbox When you explain, you
messages will need to show:
how things work, and
how or why things have
come to be the way they
Therefore the individual feels connected to other are.
individuals groups and communities. A link between
description the cause
is a statement that
How something works.
and
provideseffectit is/ used
impact
characteristics
What /
for?
Example information
What about
each partthe topic.
does.
When individuals are in another country How the
Words that show parts work together.
How to use it.
Point 2 (paragraph 2) Medium for sharing OR
cause/effect/reason/why/how
Description Because
Why something happens.
Since
How as
and why it starts
Provides a medium for family and friends to share photos What happens next, why?
Therefore
and experiences by uploading directly onto their timeline What happens after that, why?
Consequently
As What happens finally, why?
a result
Effect / impact / reason / why / how For this reason
As a result an individuals family and friends can keep up Subsequently
to date with what is going on in that individuals life. That is to say, in other
words
This means
Example
Birthday photos, baby photos
Point 3 (paragraph 3) - Security
Description
It allows people to share personal information in a safe A conclusion involves 1 2
sentences linking your points back
manner when security settings are set for friends only to the question.
Words and Phrases for a
Effect / impact / reason / why / how conclusion
For the reasons above
This means that an individual feels reassured that their
In conclusion
personal information is only seen by those people they
In other words
allow.
As you can see
Undoubtedly
Example
To sum up...
Selecting friend only in the security settings
In summary
Conclusion sum up your response link back to the
In short
question
Without question
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Preparing for the HSC Examination
The following is a checklist to review from each topic. Tick off the words/ terms/ diagrams/
calculations & concepts you immediately understand & can explain. Highlight the ones with
which you are unsure. This will be a starting point for your revision.
Topic 1 The Global Economy.
Some key terms & concepts roughly in order of appearance in syllabus content
International Global Absolute G7/8

economic production advantage
integration webs
Global FDI Comparative G20
economy advantage
Advanced Portfolio Opportunity EU
economies Investment cost
Developing Forex Market Tariff NAFTA
economies
Emerging Exchange rate Quota CERTA(ANCER
economies TA, CER)
(BRICs)
Gross World Technology, Tariff quotas ASEAN
Product Transport &
communication
Purchasing ICT Subsidy UN
power parity
(PPP)
Globalisation E-commerce Local content OPEC
Technology rules
Trade in goods diffusion Export GNI (GNI per
& services incentives capita)
WTO Offshoring Voluntary Economic
export restraints growth
Composition of Outsourcing Quarantine Economic
trade restrictions development
Direction of International & Trading bloc GDP
trade regional
business cycles
Financial flows Expansion. Free trade Global
Peak agreements Distribution of
downswing, bilateral, income
recession multilateral,
regional
International External shocks WTO Global
finance real & distribution of
financial wealth
Speculation/spe Global IMF HDI
culators resources boom
Investment & Global Financial World Bank Quality of life
TNCs Crisis
44
Home Free Trade APEC Development
country/host strategy
country
Key theories/ models/ diagrams Key Calculations

International business cycle Real GDP
Production possibilities Curve (PPC) Real GDP per capita
Tariff diagram Opportunity Cost
Subsidy diagram Government revenue from a tariff
Quota diagram
Data/ statistics/Economic Issues/Economic Skills

Effects of globalisation
Trade & Investment flows, composition & direction including change over time,
Levels & effects of protection in the global economy,
Global distribution of Y & wealth &range of Y & quality of life indicators for different
countries
Potential impact on environment of continuing world economic development
Range of data for Case Study including: trade, investment, finance, labour, GDP,
economic development strategies, economic growth strategies, quality of life, distribution
of Y & wealth, domestic policy settings, environmental impacts.
Topic 2 Australias Place in the Global Economy
Global economy Net Goods Balance on Capital Supply of AUD

& Financial Account
Economic Net Services Net errors & Demand for
performance omissions AUD
International BOGS Pitchford thesis Appreciation
competitiveness
Structural Net Primary Y Net foreign liabilities Depreciation
change
Free trade Net Secondary Net foreign debt Dirtying the float
Y
Protection Balance on Net foreign equity Fixed ER
Current Account
Australias trade Current account Terms of trade Revaluation
pattern deficit / surplus (improvement/deteri
oration)
Financial flows Structural External stability Devaluation
component
Quality of life Cyclical; CAD as a % of Managed
component GDP flexible peg
Global Capital & NFD & NFL as a % Nominal rates of
interdependence Financial of GDP protection
Account
Balance of Direct Debt servicing ratio Effective rates of
Payments investment protection
45
Current Account Portfolio Floating exchange Austrade
Investment rate
Credits Financial Bilateral/cross ER Non-tariff
Derivatives barriers to trade
Debits Reserve Assets TWI Industry
Statements

Balance of payments & components Balance of Payments credits & debits
(what goes where) Balance of Payments totals
ER diagrams (appreciation/depreciation) Net foreign liabilities

Australias exports composition, direction & trends
Australias imports composition, direction & trends
Australias financial flows & trends
BOP components
CAD structural & cyclical components
Net foreign debt, net foreign equities, Net foreign liabilities trends
AUD exchange rate & trends
RB intervention in ER
Effects of an appreciation (positive & negative)
Effects of a depreciation (positive & negative
Impacts of changes in the global economy on the Australian economy
Australias trade policy
Australias multilateral & bilateral FTAs 2 e.g. of each
Implications of Australias policies on individuals, firms, governments
Implications for Australia of protectionist policies of other countries & trading blocs
Topic 3 Economic Issues
Economic growth Structural Demand pull Private costs &

unemployment inflation benefits
Aggregate Frictional Cost push Social costs &
demand (AD) unemployment inflation benefits
AD=C+I+G+(X- Seasonal Imported inflation Market failure
M) unemployment
Injections (I, G, Hidden Inflationary Intergenerational
X) unemployment expectations equity
Leakages (S, T, Hard core Internal stability Public goods
M) unemployment
Multiplier Long term External stability Private goods
unemployment
46
MPC Underemployme Cad as a % of Free riders
nt GDP
MPS Full employment NFD as a % of Positive
GDP externalities
Real GDP NAIRU NFL as a % of Negative
GDP externalities
Business cycle Okuns Law Distribution of Y Renewable
resources
Unemployment Inflation Distribution of Non-renewable
wealth resources
Unemployment Inflation rate Lorenz curve Economic costs &
rate benefits
Labour force CPI Gini coefficient Social costs &
(Workforce) benefits
Participation rate Headline inflation ESD Carbon tax
(LFPR)
Cyclical Underlying Environmental Emissions
unemployment inflation sustainability trading scheme

Circular flow of Y (leakages & injections) Real GDP & rate of Economic
growth
AD/AS (Keynesian approach) Simple Multiplier
Business cycle Unemployment rate
Short run Phillips curve LFPR
Long run Phillips curve Inflation rate
Demand pull inflation Change in national Y
Cost push inflation Gini coefficient interpretation
Lorenz Curve
Gini coefficient
Private & social costs
Effect of a tax on pollution

Real GDP
Implications of the multiplier for fluctuations in the level of economic activity
CAD, NFD & NFL as a % of GDP & trends
Unemployment rate, types & causes
Inflation rate, including CPI & underlying, effects on an economy
Australias Gini coefficient & Lorenz curves & trends in distribution of Y & wealth
Economic & social costs of inequality
Economic issues associated with ESD
47
Topic 4 Economic Policies & Management
Economic growth Headline cash MER Modern awards

outcome(balance
)
Internal balance Headline cash Product markets Single enterprise
outcome(balance agreement
)
External balance Discretionary FP Factor markets Multi enterprise
agreement
Full employment Structural Allocative Greenfields
component efficiency agreement
NAIRU Non-discretionary Technical Unfair dismissal
FP efficiency
Price stability Cyclical Dynamic BOOT
component efficiency
External stability Automatic Deregulation Conciliation
stabilisers
Distribution of Y & Fiscal Corporatisation Arbitration
wealth consolidation
Environmental; Monetary Privatisation Good faith
sustainability
financing bargaining
ESD Crowding out NCP Industrial action
effect
Phillips Curve Monetary Policy ACCC Centralised wage
determination
BOP constraint DMOs (OMOs) Workable Decentralised
competition wage
determination
Macro Policy Loosening MP Productivity Education &
(Demand-side) (Expansionary) Training
Micro Policy Tightening MP Environmental Labour market
(Supply-side) (Contractionary) management programs
policies
Economic policy Money supply Targets Time lags
mix (Supply of loanable
funds)
Counter-cyclical Inflation targeting Regulations Recognition lag
polices
Fiscal Cash rate Market based Impact lag
(Budgetary) policies
policy
Budget Short-term MM International Political
agreements constraints
Surplus ESAs Industrial awards Trade-offs
Deficit CGS & Repos WRA 1996 Global influences
WRA
(WorkChoices
Amendment)Act
2005
Balanced Transmission Transition to
mechanism Forward with
48
Fairness Act
(2008)
Underlying cash Structural change Fair Work Act
outcome(balance) (2009)

Topic 3 ones + Budget outcome
Inflationary & deflationary gap analysis
Impact of a change in G &/or T on the Keynesian diagram
Impact of MER on AS
RBA determination of the cash rate
Labour market diagram with wage rates

Current year budget data, including budget outcome, stance & specific measures
Interest rate level, trend & expected trend
Minimum wage & change from last year
Current Labour market policies
Current environmental policy
SOME THOUGHTS ON EXCELLING IN THE ECONOMICS EXAM
(adapted from a presentation by Bronwyn Hession former Supervisor of Marking & former President of EBE)
The Notes from the Marking Centre reports on each years HSC examination are a
valuable source of information. Read in conjunction with the exam paper & the marking
guidelines they provide indicators of strengths & weaknesses in student exam responses,
both in terms of issues related to the specific Economics of particular questions & to
examination technique in Economics.
Here are some key things to consider as you prepare for your HSC.
1. Defining economic terms & concepts there can be no doubt that a feature of quality
(Band 5 & 6 responses) in Economics is the concise & accurate definition of the terms &
concepts in the question itself & in the related content. You need to rote learn these key
terms & concepts (contained in the glossary of this document). Parents & younger/older
brothers & sisters can help get them to quiz you.

2. Pre-prepared answers DO NOT learn entire extended responses & reproduce them in
the examination. This is taking a big risk & you need to be aware of the consequences.
Each year there are comments about this issue & students fail to access the higher mark
bands because they fail to answer the question asked. The Economics exam is not an
event where you can write what you have learnt. It is an opportunity for students to
demonstrate what they know & can do by applying their knowledge & understanding
to the specific questions asked.
3. Reading the question carefully & planning accordingly students who are often
nervous or rushed for time, commonly do not dissect & analyse exactly what the question is
asking before they start writing. Ten (10) minutes spent on a plan is NOT a waste of
time, it is a critical investment in a quality answer. The chronic things that get
overlooked include students ignoring the fact that:
49
Some questions ask for CAUSES, others ask for TYPES;
Some ask for METHODS, others ask for REASONS;
Some ask for FEATURES, others ask for IMPACTS;
Some ask for STRATEGIES, others ask for POLICIES

THESE ARE DIFFERENT !!!!!

When your plan is done DO NOT cross it out. Do the plan on the first page of the booklet. The
marker WILL look at it. It gives an insight into your thinking. Should you run out of time, you may get
some credit from having shown your whole plan, even though you did not get to complete the whole
response.
4. Good & bad traits outstanding responses are clear, concise & accurate & use data.
Weaker responses are described as lacking analysis, poorly organised, demonstrated
limited understanding. Look at the notes from the marking centre for the past few years,
find more examples of the traits of better & weaker responses. Use this information to
improve the quality of your responses.
5. Stimulus material on the whole students use it well but others copy it, ignore it or fail to
realise that it is there to provide an indicator or a clue about content. Students are
sometimes very careless in analysing it. The sources of the quotes should be noted e.g. a
comment from RBA is a different perspective than a comment from Treasury.
6. Think like an Economist A reminder that economics often involves things like:
Using short & long term analysis, whether the question asks for it or not
Examining both domestic & global context
Looking at impacts NOT from a general perspective but impacts on individuals, business
or government or manufacturers or service industries or exporters or investors
7. Calculations Students continue to make errors in these calculations so make sure you
CAN do these, they are easy marks for the students who get them correct Balance of
Payments, real GDP, MPC, MPS, multiplier & change in investment/national income,
participation rate, unemployment rate, AD, inflation rate
8. Units, increase & decrease When calculations are included in the SA section, students
lose marks because they forget to specify the units or they get it wrong they leave off
billions or millions or they put 12 instead of 12 000. If a question asks about a change,
then state the change & whether it is an increase or a decrease.
9. Short answer questions some students fail to answer the SA questions in the space
provided & write excessive amounts in additional booklets, sometimes for a question worth
just 3 marks. The opportunity cost of this is that they may run short of time for the extended
response questions. Being concise & hitting the nail on the head is an art form in
Economics practice makes perfect.
10. Objective Response there is no substitute for practice over & over again. But
beware the style of the question is important. Textbook authors often leave development
of test questions to the last minute; the items therefore often suffer from poor quality. The
best practice questions are past HSC papers. Students are usually correct in their first
response to OR questions so be very careful about going back & changing the answer.
50
11. Things that matter these are some of the things that students continue, year after year
to demonstrate poor understanding of:
Confusion between reducing a deficit & financing a deficit
Confusion between the current account deficit & the budget deficit
Monetary policy & how it works (money supply, cash rates, mechanisms etc)
Foreign debt (what it is & how it is measured)
Confusion about an increase in supply & a decrease in supply (graphs)
Money & real GDP
Productivity & production
Interest rates & exchange rates (including increase & decrease in demand & supply of AUD)
Balance of payments what is on what account & what impacts on items)
AD & AS (this analysis rarely appears in extended responses & yet it is so valuable)
Environmental management including public & private goods & domestic & international
policy responses
Policy constraints

12. Suggested revision strategies:
Review the topics in relation to EACH of the syllabus headings, dot points & dash points
INCLUDING the Learn to & Learn about sections
Focus on the syllabus NOT on a textbook
Continually reduce your summaries, DO NOT just read through them as this is useless
your brain must be engaged in the activity
Practice, practice, practice OR, SA & extended response questions
See you teacher to clarify any content about which you are unclear
Study with a buddy or get your family to quiz you on definitions
51
HINTS FOR MAXIMISING YOUR RESULTS.
Good preparation involves working steadily throughout the course. There are a number of
ways you can help yourself:
Be positive about yourself & your abilities. Aim to achieve YOUR personal best by
having 3 good meals a day, some recreation & adequate sleep.
Rote learn the meanings of the directive terms.
Set up a home study timetable & allocate time each week for the completion of
summaries.
The format of these summaries will depend on your own INDIVIDUAL LEARNING
STYLE whether you number your points, draw mind maps, colour code your notes or
type them up using different fonts & dot point styles BUT they must follow the syllabus.
Keep your summaries UPDATED & use a variety of sources for your notes including
class notes, newspapers & the Internet, as well as textbooks.
Economics requires students to have current knowledge of events in BOTH the
domestic & global economies, so read the newspapers, listen to & watch news
programs regularly.
Include current economic statistics, conditions & issues in your study notes. Learn as
many statistics as you can but remember a lot is going on in the world of economics so
it is important to keep informed.
It is not just what you know, it is what you can DO WITH THAT KNOWLEDGE that is the
key to success in Economics.
Do ALL the set work. Class work is designed to improve your knowledge, understanding
& skills. You need to be able to write LEGIBLY, accurately & at speed for the HSC.
At the end of each topic test yourself on the syllabus headings & dot points including
definitions, formulas & skills.
Learn the glossary of key terms for each topic. In order to achieve Band 6 results you
must demonstrate your use of relevant terminology & the glossary will form the core
words of this terminology.
Use the Board of Studies website (www.bos.nsw.edu.au) to complete past papers. The
multiple choice questions will be marked automatically as you go. Read the marking
guidelines & notes from the marking centre.
Use the HSC Online website (www.hsc.csu.edu.au) to complete tutorials & summary
exercises.(This has not been updated for 3 years though)
ECONOMICS THE HSC EXAMINATION
52
ALL topic areas in Economics are tested in the examination.
The syllabus is the best guide for preparing for the examination; it can be used as a
checklist because examination content is drawn from the Learn About & Learn To points.
It is essential to practise examination technique as part of the revision process in order to
complete the paper efficiently.
Stress
Some stress is good because you will perform at your peak. Too much stress is harmful so
try to control this by taking time out to relax, play sport, go for walks & refresh yourself.
Avoid comparing yourself to others; your aim is to perform at YOUR personal best.
Think positive thoughts, be prepared, study, eat well & sleep well.
At The Examination
Before you go in:
Arrive in PLENTY of time, with the equipment you need in a CLEAR plastic sleeve 2B
pencil, calculator, several pens & a highlighter.
Make sure you have eaten well.
Use a method to calm yourself either music, sitting quietly on your own or chatting with
friends.
In the examination room/hall:

Listen carefully to the supervisor.
Use the 5 minutes reading time to select the extended response questions you will do.
Plan your time & watch the clock so that you keep to the time allocation most effective for
you. Remember the law of diminishing returns applies to exams, spending 10 minutes over
time to finish one section is likely to get you fewer marks than spending 10 minutes starting
a new section.
Never give up. Work right to the end of the time. Even if you are not sure of the answer,
have a go.
DONT panic, if you read a question you THINK you cannot answer, just take a deep
breath, be positive & read the question again. You WILL be able to answer it.
Check your paper before you hand it in. Ensure ONLY your student NUMBER is on all
sections of the paper.
53
STRUCTURE OF THE HSC EXAMINATION PAPER.

The examination will consist of a written paper worth 100 marks.
Time allowed: 3 hours plus 5 minutes reading time.
The paper will consist of 4 sections.

Section I: Objective Response Questions (20 marks) Previously known as Multiple
Choice
Questions may be drawn from ANY of the 4 HSC topics.
The BOS recommends a time limit of 35 minutes for this section; however, students should
attempt to save time in the objective response section to have more time for the Stimulus
Extended Response & Extended Response. Students should allocate approximately 20-25
minutes to answer the 20 objective response questions.
It is a good idea to do the objective response section FIRST as it will help students to recall
vital economics terminology, to settle into the paper & to stimulate the brain for the other
sections of the exam.
Objective Response questions may include interpretation of stimulus material such as a
diagram, table of statistics or a quote, calculations & definitions.
Based on past examination papers objective response questions tend to test 5 major skills:
1. Definitions of basic concepts
2. Economic calculations
3. The interpretation of diagrams, statistics & economic models.
4. The application of economic analysis to current economic issues.
5. The use of logical reasoning skills
Section II: Short Answer (40 marks)

Questions may be drawn from ANY of the 4 HSC topics. There will be 4 short answer
questions, divided into parts with each question worth 10 marks in total. The BOS
recommends 1hour 15 minutes be spent on this section but most students will complete this
section in 40-50 minutes.
Before completing a question, identify the key directive word/s & the topic area being
examined. It is a good idea to write key words/phrases for the answer along the margin of
the answer space as they come to mind.
Pay careful attention to how many marks & lines each individual question is worth as
this is a guide to how much depth is required in the response.
Stimulus will be provided (in most but not all questions), such as a diagram, table of
statistics or a quote. When stimulus is provided, incorporate this material into your
answer & tailor your response to suit the stimulus.
Students should show ALL WORKING if a calculation is involved in the question and
students should complete the calculation TWICE to ensure no calculator errors were made.
Section III: Stimulus Extended Response (20 marks)

Candidates choose to answer EITHER Question 25 OR Question 26. The Board
recommends a time of 35 minutes for this section, but this should be a MINIMUM time.
54
Students should spend 50-60 minutes on this section which includes the writing of an
essay plan as this will help students to logically sequence their response.
Each of these questions includes some stimulus such as a diagram, table of statistics or a
quote, or a combination of stimuli.
DO NOT copy the stimulus, use the information to help form your response.
Students must refer to the stimulus material SPECIFICALLY in their response; do so by
referencing the SOURCE of the stimulus.
It is important to pay careful attention to the key directive terms when formulating the
response.
Define key economic terms throughout the response & wherever possible give examples
to illustrate the response & to demonstrate the depth of content knowledge.
Section IV: Extended Response (20 marks)

The final section of the paper is an extended response. There will be a choice of 2
questions; students complete EITHER Question 27 OR Question 28. Often the structure of
the response is contained in the question. The Board recommends a time of 35 minutes for
this section, but this should be a MINIMUM time. Students should spend 50-60 minutes on
this section which includes the writing of an essay plan as this will help students to
logically sequence their response.
An extended response is a question type which allows students to show the examiner the
depth of their understanding of the course concepts.
Students must integrate economic data into their response.
It is important to pay careful attention to the key directive terms as there is often more
than one within the question.
In writing extended responses go BACK to the wording of the question regularly. This
reminds the markers (& yourself) that you are addressing the question specifically.
Define key economic terms throughout the response & wherever possible give examples
to illustrate the response & to demonstrate the depth of content knowledge.
Students should learn a country case study OTHER than Australia & how government
policies have responded to the forces of globalisation in promoting economic growth &
development in this country.
55
ESSENTIAL DATA / STATISTICS FOR THE HSC
EXAMINATION
Economics students SHOULD know the following statistics as they go into the HSC exam.
Labour Market Source: ABS, Labour Force Australia www.abs.gov.au
Sept Augu July Trend for the year

embe st
r
U/E rate
Participati
on rate
Comments for September:
Inflation Source: RBA website www.rba.gov.au
Latest ?? Jun Q Mar Q Dec Q

?? (Current Yr) (Current Yr) (Previous Yr)
CPI
Comment on TREND for the Yr & causes for trends if known:
Check night BEFORE HSC for latest figures.
Cash Rate - Source: RBA website www.rba.gov.au
Latest: Must know outcome of October Last change? When? By how much?
RBA board meeting. Get AFR on the Trend over the Yr?
Wednesday for Analysis
International Comparisons of Cash Rate (also from www.rba.gov.au
56

US Eu UK Ja
A ro pa
n

GDP Source: ABS www.abs.gov.au
JUNE Q GDP growth (Published in September) Year on Year YoY

Comment on figures revised? Why? Include comment on World Outlook

Budget (FP) Source www.budget.gov.au
Next Current Previou Overall/general

Yr Yr s Yr comments
Estim Budget Budget
ate
Underlying
Cash
Balance &
Outcome
% of GDP

CAD & TRADE Source ABS www.abs.gov.au

BOGS (Surplus/Deficit/Trend)

CAD
(Size, Trend)

ToT (Trend)

Exchange Rate & TWI Source www.rba.gov.au
57
Most recent AUD/US exchange rate TWI

Comment on TREND in ER & TWI over the year:
A GLOSSARY OF KEY WORDS

Syllabus outcomes, objectives, performance bands and examination questions
have key words that state what students are expected to be able to do. A
glossary of key words has been developed to help provide a common language
and consistent meaning in the Higher School Certificate documents.
Using the glossary will help teachers and students understand what is expected
in responses to examinations and assessment tasks.
It is important to note that examination questions for the HSC will continue to
use self-explanatory terms such as how, or why or to what extent.
Account Account for: state reasons for, report on. Give an account
of: narrate a series of events or transactions
Analyse Identify components and the relationship between them;
draw out and relate implications
Apply Use, utilise, employ in a particular situation
Appreciate Make a judgement about the value of
Assess Make a judgment of value, quality, outcomes, results or
size
Calculate Ascertain/determine from given facts, figures or
information
Clarify Make clear or plain
Classify Arrange or include in classes/categories
Compare Show how things are similar or different
Construct Make; build; put together items or arguments
Contrast Show how things are different or opposite
Critically Add a degree or level of accuracy depth, knowledge and
(analysis/ev understanding, logic, questioning, reflection and quality to
aluate) (analyse/evaluation)
Deduce Draw conclusions

Define State meaning and identify essential qualities
58
Demonstrate Show by example
Describe Provide characteristics and features
Discuss Identify issues and provide points for and/or against
Distinguish Recognise or note/indicate as being distinct or different
from; to note differences between
Evaluate Make a judgement based on criteria; determine the value
of
Examine Inquire into
Explain Relate cause and effect; make the relationships between
things evident; provide why and/or how
Extract Choose relevant and/or appropriate details
Extrapolate Infer from what is known
Identify Recognise and name
Interpret Draw meaning from
Investigate Plan, inquire into and draw conclusions about
Justify Support an argument or conclusion
Outline Sketch in general terms; indicate the main features of
Predict Suggest what may happen based on available information
Propose Put forward (for example a point of view, idea, argument,
suggestion) for consideration or action
Recall Present remembered ideas, facts or experiences
Recommend Provide reasons in favour
Recount Retell a series of events
Summarise Express, concisely, the relevant details
Synthesise Putting together various elements to make a whole
59

Acknowledgements
Board of Studies website
HSC Online Website
Year 12 Economics Workbook Riley & Kennedy
Year 12 Workbook Tony Stokes
Tim Dixon Presentations to UBS Economics Study Days
60

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CHELTENHAM GIRLS HIGH SCHOOL

SOCIAL SCIENCES FACULTY

Higher School Certificate Course % of course Indicative

Assessment Components and Weightings

No more than 50% weighting may be allocated to tests & examinations.

Reporting achievement at the HSC

Task Task Type Outcomes Task My Marks My Rank My

2 OR & SA Qs on H1, H2, H3,

Table of Objectives and Outcomes

Objectives HSC Outcomes

communicate economic H10 communicates economic information, ideas and issues in

H12 works independently and in groups to achieve appropriate

Important Web sites:

www.afr.com.au Australian Financial Review

www.economist.com A periodical (Journal) that is regularly updated, it provides articles on

Content based websites:

www.keystoneeconomics.com free subscription website, analyses key events from newspapers

www.ubs.com/hsceconomics An outstanding website, written for the NSW HSC syllabus.

Statistics & current domestic & global information websites:

www.rba.gov.au Reserve Bank of Australia, Monetary Policy Statements, current statistics on

www.abs.gov.au excellent statistics on trade, economic growth & labour force

Revision & preparation website:

25% of indicative time

Students learn to:

Examine economic issues

Apply economic skills

International economic integration

Trade, financial flows and foreign investment

Globalisation and economic development

25% of indicative time

Students learn to:

Examine economic issues

Apply economic skills

Australias trade and financial flows

Value, composition and direction of Australias trade and financial flows

Australias Balance of Payments

Free trade and protection

25% of indicative time

Students learn to:

Examine economic issues

Apply economic skills

25% of indicative time

Students learn to:

Examine economic issues

Apply economic skills

Economic objectives in relation to:

Potential conflicts among objectives

Labour market policies

National and global context for environmental management

The real growth rate is measured by:

Real GDP in given year real GDP in previous year 100

The real GDP per capital is simply

Total real GDP

MEASUREMENT OF ECONOMIC GROWTH (also TOPIC 3)

Real GDP = Money GDP CPI in base year

STRUCTURE OF THE BOP

The Current Account

Goods credits (X) Goods debits (M) = Net goods

Service credits (X) Service credits (M) = Net services

Net goods + Net services= Balance on Goods & Services (BOGS)

Primary Income credits Primary Income debits = Net Primary Income

Secondary Income credits Secondary income debits = Net Secondary income

TERMS OF TRADE (Calculation not needed in new syllabus)