Wednesday, March 05, 2008

Unit 3: Controlling inflation in Australia

The BBC reports Australia's efforts to reduce inflation

http://news.bbc.co.uk/1/hi/business/7276367.stm

a) What sort of inflation is Australia suffering from?
b) What policy is Australia using to combat inflation?
c) Using a diagram, explain how Australian inflation should be reduced
d) What effect is the rise in interst rates likely to have on the exchange rate and Australia's BOP?

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