Economic Growth and GDP of Australia over the Last Five Years

Running head: ECONOMICS FOR BUSINESS
ECONOMICS FOR BUSINESS
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Table of Contents
Introduction......................................................................................................................................2
Present economic condition of Australia.........................................................................................3
Economic growth of Australia during the last five years................................................................3
GDP of Australia during the past five years....................................................................................6
Policies adopted by the policymakers for maintaining stable economic growth...........................12
Conclusion.....................................................................................................................................12
References......................................................................................................................................14

2ECONOMICS FOR BUSINESS
Introduction
The purpose of this report is to highlight on the economic growth and GDP (Gross
Domestic Product) of Australia over the last five years. Economic growth refers to an increase in
inflation adjusted value of products and services that is produced by a particular economy over
the years. It is usually measured as increase in real GDP that means rise in value of nation’s total
output. Economic growth is one of the crucial macroeconomic objectives as it enables rising
living standards, enhances in tax revenues and facilitates in creating jobs (Arena 2016). GDP in
Australia refers to the market value of all products and services produced within the geographical
boundary of Australia over the time. This macroeconomic indicators usually measures economic
performance of a specific country during a specific time period. The real GDP of Australia has
fluctuated considerably and ended at 2.3% in the year 2017. This fluctuation was mainly
contributed by consumer expenditure, government expenditure, investment expenditure and net
exports. At present, the economic growth of Australia has been increasing at its trend rate mainly
due to rise in consumer expenditure and government spending. Moreover, the standard of living
of Australians improved although there have been slight fluctuations in economic growth. The
non- mining sector of this nation specially contributed to economic growth of Australia along
with low unemployment rate and steady inflation rate. This report also analyzes on the present
economic condition of Australia based on growth of macroeconomic indicators including
unemployment rate, inflation rate and terms of trade. Furthermore, the policies adopted by the
Australian government for maintaining stable economic growth and GDP over the years are also
discussed in this report.

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Present economic condition of Australia
The present economic condition of this country improved after a slowdown from the past
few years. The economic growth of Australia was mainly driven by the public as well as private
sectors over these years. Rise in activities in public infrastructure and private business
investment underpinned huge growth in the industries. In fact, investment in non-mining sector
increased at robust pace, supported by huge growth in population and dynamic economic activity
(Burda and Wyplosz 2013). Real GDP of the economy has increased by a yearly average of near
about 2.7% during the past five years. The unemployment rate and inflation rate remained quite
low over these five years. There has been huge growth in jobs over these years, thereby leading
to increase in employment rate. Even though GDP per capita increased over the past five years,
the GDP of Australia declined over this period. The balance of trade in this nation improved in
the present year after huge decline in the year 2015 and 2016. This means that both export as
well as import expanded by near about 1% in the year 2017. In addition to this, the business
investment also increased at higher levels even though it slowed down in the past few years.
Even the investment in housing also increases at modest pace despite increase in growth of
population. This is mainly because of relative increase in housing cost, rigidities in supply
process of housing and huge difficulties for the developers to obtain funds. Although the
economic growth of Australia has shown huge fluctuation during the last five years, it improved
in the last year. Mover, it has been predicted by RBA that the economic growth of this nation
will continue to increase in the next couple of years.
Economic growth of Australia during the last five years
Over the last five years, the economic growth rate of Australia has shown huge
fluctuations. It has been indicated by the real GDP growth rate indicator that economic growth