Worksheet 4: What Does Your Country Make? Name: Claudia Pena

Worksheet 4 What Does Your Country Make Name Claudia Penadirecti

Identify and analyze the economic contributions of Australia by completing the Percent and Dollars columns based on data from the CIA Fact Book. This involves calculating the dollar amounts for each component (Consumption, Investment, Government Spending, Exports, Imports) using the given percentages and total GDP. Subsequently, compare these figures to those of the United States, focusing on the differences in economic structure and scale. Finally, interpret the sectoral distribution within Australia’s economy, considering its implications for economic development, employment, and sectoral growth.

Paper For Above instruction

Australia's economy, with its distinctive structure and significant global presence, offers an intriguing case for analysis when compared to the United States. Using data from the CIA Fact Book, we can explore the composition of Australia's gross domestic product (GDP) and examine how different sectors contribute to its overall economic activity. This analysis will not only quantify the economic output in dollar terms but also provide insights into the predominant industries, sectoral employment, and economic resilience.

GDP Components and Calculations

Based on the provided data, Australia's total GDP is calculated at approximately $1.39 trillion USD. The percentages assigned to each component of GDP reflect its relative contribution to the economy. To analyze these, we multiply the total GDP by each component's percentage to find the dollar amount.

Consumption (C), at 69%, amounts to:

• $1.39 trillion * 0.69 = approximately $959.1 billion

Investment (I), at 16%, amounts to:

• $1.39 trillion * 0.16 = approximately $222.4 billion

Government Spending (G), at 18%, amounts to:

• $1.39 trillion * 0.18 = approximately $250.2 billion

Exports (X), at 12%, amount to:

• $1.39 trillion * 0.12 = approximately $166.8 billion

Imports (M), at -15%, are subtracted, amounting to:

• $1.39 trillion * -0.15 = approximately -$208.5 billion

The net exports (Exports minus Imports) thus contribute about:

• $166.8 billion - $208.5 billion = -$41.7 billion

These calculations reflect Australia’s economic reliance on domestic consumption, with notable contributions from the service sector—particularly tourism, finance, and education—aligned with its sectoral distribution.

Comparison with the United States

Contrasting Australia's economy with that of the United States reveals several differences in scale and sectoral distribution. The U.S. GDP totals approximately $18.57 trillion, with a more diversified and larger economy. Consumption accounts for 69%, akin to Australia's, but absolute dollar amounts are vastly higher, reflecting the larger population and economic size.

The U.S. invests around 16%, similar to Australia, but the total dollar value of investments is much greater, supporting a more complex industrial base. Government spending in the U.S. is also comparable in percentage terms, emphasizing the role of federal expenditure in economic stability and growth.

Exports and imports form a significant part of the U.S. economy, with trade deficits often prominent, unlike Australia's relatively smaller trade deficit or surplus situation. The foreign trade component underscores the importance of globalization in the U.S. economy, which is more interconnected with global markets than Australia's relatively isolated trade patterns.

Sectors and Economic Implications

Australia’s economy is heavily weighted towards services, representing 80% of GDP, which includes finance, healthcare, education, and tourism. Its industrial sector, comprising manufacturing and mining, accounts for 19%, reflecting its natural resource abundance, particularly minerals and energy exports.

The agricultural sector, although small in percentage terms (1%), remains significant for exports like wool, wheat, and meat. The dominance of services indicates a developed economy with a high level of human capital and technological advancement, aligning with broader economic development theories.

Australia’s sectoral composition influences its employment patterns, economic resilience, and vulnerability to global commodity price fluctuations. The heavy reliance on services and resource exports suggests a need for diversification to sustain long-term growth, especially amid climate change concerns and shifting global demand.

Economic Development and Sectoral Strategies

Understanding Australia's economic structure through these calculations allows policymakers to frame strategies for sustainable growth. Supporting innovation in service industries, investing in renewable energy, and diversifying export markets are crucial for resilience. Additionally, fostering domestic manufacturing and technological development can reduce vulnerability to commodity price swings.

Furthermore, Australia’s economic model emphasizes quality of life, health, and education, reinforcing its reputation as a high-income, developed nation. The challenge remains to balance resource dependence with sustainable development and to adapt to global economic shifts, especially considering environmental sustainability and technological progress.

Conclusion

By completing the Percent and Dollars calculations for Australia and comparing them with the U.S., it becomes evident that Australia's economy is characterized by a dominant service sector, substantial resource exports, and moderate industrial activity. While smaller in scale, Australia’s economy demonstrates resilience and specialization, positioning it uniquely in the global economic landscape. Understanding these components provides valuable insights for economic policy and strategic development aimed at maintaining growth and sustainability in an interconnected world.

References

• Australian Bureau of Statistics. (2023). Australia’s Economy: Statistical Overview. ABS Official Reports.
• Central Intelligence Agency. (2023). The World Factbook: Australia. CIA.
• EconData. (2023). Comparative Analysis of the US and Australian Economies. EconData Publications.
• International Monetary Fund. (2023). World Economic Outlook: Australia. IMF Reports.
• World Bank. (2023). Global Economic Prospects: Australia. World Bank Publications.
• Reserve Bank of Australia. (2023). Financial Stability Review. RBA Reports.
• OECD. (2023). Economic Outlook for Australia. OECD Publications.
• Australian Government Department of Industry, Science, Energy and Resources. (2023). Resources and Energy Data. Australian Government Website.
• United States Census Bureau. (2023). U.S. Economic Data and Statistics. Census Bureau Reports.
• Trade and Investment Queensland. (2023). Australia's Trade Profile. Trade Queensland.