Short Answer
1. Outline recent changes in the direction and composition of Australia's trade flows.
2. Explain why foreign direct investment might be preferrable to portfolio investment.
3. What is the balance of payments? Outline the structure of the two main accounts of the balance of payments.
4. Explain the relationship between the current account and the capital and financial account.
5. Look at Australia's recent balance of payments performance. What short term and long term factors are influencing the CAD?
6. How do international borrowing and foreign investment impact on Australia's balance of payments?
7. Discuss the impacts of structural and cyclical factors on the net primary income.
8. How have recent movements in Australia's terms of trade impacted on the current account?
9. What impact does Australia's level of domestic savings have on the balance of payments?
10. Discuss the positives and negatives of a high CAD.
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