each answer should be of 500 words.australian economy should be discussed.

Solution to question 1
The mineral wealth of Australia gives it a comparative advantage over the world. Mining
is a natural occupation of the people of Australia. Even the stock exchange of the country is
dominated by companies which own mineral reserves. In terms of sector wise rate of growth, the
Australian economy has often been divided into mining and non-mining sector. While the former
is expected to grow at around 7.41% (during 2012-16), the growth plans of the latter are still to
see the light. The economy is now referred to as two speed economy with the mining and related
sectors growing at a rate which is manifold times higher than the non-mining sector. The gap has
widened over the years. The graph below shows the multispeed growth phenomena in the
Australian economy as the divide between the engineering construction (due to the mined
resources) and the other subsectors has been growing rapidly. The housing sector has been
lagging behind due to credit crunches and rising competition.
Source: http://www.macrobusiness.com.au/2012/01/aig-pci-release
http://www.macrobusiness.com.au/2012/01/aig-pci-release
Internal Factors
Mining and related activities comprise of 19% of the nominal GDP of Australia. With
substantial deposits of metallic minerals (iron ore, silver, copper, gold, zinc etc.) and nonmetallic
minerals (coal, phosphate, salt, fluorspar, Uranium etc.) the economy depends on the strength of
this sector and the related subsectors. The export sector is mainly involved in exporting these
minerals of which coal and iron ore are most important.
The figure above gives data on the positioning of Australia in the world in terms of coal
production and consumption. While it is the third largest producer of coal in the world,
consumption is comparatively less as most of the coal is exported. In fact Australia has been the
largest exporter of coal for a long time. This is also why the economy is driven by the mining
sector as the manufacturing sector is still lagging. As the world’s reserves of coal are on the
verge of exhaustion, the coal mining and exporting sector of Australia is flourishing well.
Carbon Tax
Australia is considered to be the most Coal dependent economy in the world. With coal
reserves of about 76 billion tones, hardly any efforts were taken by the Federal to generate
energy from renewable sources till recent times. During the period of 2011-16, the coal mining
sector is expected to grow at record high level of 6.5%. In 2001, however, the government
decided to set up a target of switching over to green sources of energy for 20% of electricity
generation. Besides this the...