Current Budget and Economic Effects (1 Viewer)

[Avenger6]

Hi, I have a task coming up soon and I need to relate some changes in the current budget to the economic effects of:

-Resource Use
-Income Disribution
-Economic Activity

Im a little stuck and am not sure where my examples fit in. At the moment I have the $19billion investment in education to fund the digital education revolution as affecting resource use, is this correct? If you could provide an example for each of the three effects above it would greatly help me understand how the budget affects these areas.

Thanks

 

[JustAnotherNE]

check zahmad's post under yours, its pretty much the same task

 

[munchiecrunchie]

Here's some stuff off the top of my head:

- we are directing our resources into investment in education and technology, which will increase our productive capacity, alleviating the extent of current supply contraints + reducing inflationary pressures.

- greater taxation for high income earners, creating a more equitable distribution of income (luxury car tax, etc)

- less govt suport for high income earners - more efficient allocation of resources, more equitable distribution of income. (eg baby bonus means tested)

- its an increased budget surplus - contractionary fiscal policy which reduces AD, and hence has the effect of reducing demand pull inflation, and can curb economic growth rates

- reduced demand will therefore cause an increase in unemployment