Economics for Business Assessment 2022

Running head: ECONOMICS FOR BUSINESS
Economics for Business
Name of the Student:
Name of the University:
Author’s Note:

ECONOMICS FOR BUSINESS
2
Table of Contents
Introduction......................................................................................................................................3
Discussion........................................................................................................................................3
Industry Background...................................................................................................................3
Market Structure..........................................................................................................................4
Issue Associated with the Industry..............................................................................................6
Impact of the Issue on the Banking Sector and Australian Economy.........................................8
Government Policies..................................................................................................................10
Conclusion.....................................................................................................................................11
Reference.......................................................................................................................................12

ECONOMICS FOR BUSINESS
3
Introduction
The main purpose of the assessment is to analyse the banking sector which operates in
the Australian market and the overall impact which the business has on overall economy as
whole. The analysis would also be including the significant governmental regulations which
have been brought about in the banking sector and how the same has improved the efficiency of
the sector. The discussion would also be including analysis utilizing the demand and supply
model to get a clear picture of the Australian Market. In addition to this, the governmental
intervention would also be discussed in details.
Discussion
Industry Background
The banking sector can be regarded as one of the most important sector in any economy
and has a vital role to play in the overall growth and development of the economy as a whole. In
the economy of Australia, the banking sector is dominated by four major banks which largely
handles majority of the financial transactions in the economy. Commonwealth Bank of
Australia, Westpac Banking Corporation, Australia and New Zealand Banking Group,
and National Australia Bank are the four major banks which controls all the operations of a
business and contributes to the financial requirements of the country. These four banks have
significantly developed over the years in terms of market capitalization and also in terms of the
number of customers which are served by the bank (DailySabah. 2019). It is also to be noted that
the big four banks of Australia also make it to the list of top 25 safest banks operating around the
world. The banking system in Australia has developed significantly setting up numerous small
banks thereby strengthening the financial sector of the country. It is also to be noted that the

ECONOMICS FOR BUSINESS
4
banks also take additional responsibility for managing the foreign exchange for the people who
are visiting the country. One of the reasons due to which the Australian financial sector is strong
and ready to face any kind of adverse shock is due to the presence of strong banking system
which is further developing and growing. The banks capital ratios are also well maintained by
the banks in comparisons to the minimum which is required.
Market Structure
The market structure of the banking sector has been enormous and the same is still
growing which makes the sector vital in terms of contribution which the sector makes to the
GDP of the country (U.S. 2019). It is to be noted that the growth of the industrial sector and
other sector in Australia is dependent on the efficiency of the banking sector and therefore
appropriate regulations and restrictions are brought in so that effective control can be exercised.
The analysis of the performance of the banking sector from the past has shown the sector
has contributed most to the growth and development of different industries which are operating
in economy and how well the banks have meet the expectations of the customers in creations of
wealth (Reserve Bank of Australia. 2019). In order to effectively show the creation of wealth by
the banking industry over the past 20 years in Australia, a graphical presentation is shown below: