Subject matter

Topic 3: Economic Management

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In Topic 3, students examine policy choices made in Australia about economic activity. This topic has three sub-topics, each of which focuses on an aspect of policy decision-making based on demand management and supply-side economic ideas and perspectives.

• Comprehend and explain a rationale for the government to

  • develop and implement economic policies that consider efficiency, equity and trade-offs

  • stabilise the economic cycle and attain a range of economic objectives including sustainable economic growth; economic prosperity and wellbeing; internal stability; external stability.

• Comprehend and explain demand management and supply side policies and their limitations including structural deficits, time lags, global influences and political constraints.

 

Sub-topic A: Demand management policies — fiscal policy

• Comprehend and explain the sources of government revenue (direct and indirect taxation; progressive, proportional, and regressive taxation) and the components of government expenditure (current, capital and transfer payments; public utilities and merit goods) in the federal budget.

• Analyse and evaluate the impact and/or effectiveness of fiscal policy responses to achieve Australia’s economic objectives in the future.

 

Sub-topic B: Demand management policies — monetary policy

• Comprehend and explain the role of the Reserve Bank of Australia (RBA) and the objectives of monetary policy as outlined in its charter.

• Comprehend, explain, analyse and evaluate the

  • concept of inflation targeting and the significance of monetary policy on the level of economic activity, and include a discussion of percentage change and basis point change

  • transmission mechanism and channels of monetary policy, and their influence on the level of aggregate demand

  • impact on and/or effectiveness of monetary policy responses to achieve Australia’s economic objectives.

     

Sub-topic C: Supply side and microeconomic policies

• Comprehend and describe the nature and aims of aggregate supply policies (including microeconomic reforms) and explain their relationship to domestic macroeconomic objectives.

• Comprehend and explain how a government policy focused on a supply side improvement can impact Australia’s economic growth through productivity, efficiency or competitiveness, using infrastructure; education and training; research and development; innovation, and deregulation.

• Analyse and evaluate the impact of and/or effectiveness of policy responses to achieve Australia’s economic objectives.

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Reproduced from Queensland Curriculum and Assessment Authority,  Economics 2025 v1.2 General senior syllabus October 2024