Microsoft Word - ECON1061_Assignment_Semester 1 2020
ECON1061 – Group Assignment, Semester 1, 2020 Page 1 of 11
SCHOOL OF ECONOMICS, FINANCE AND MARKETING
ECON1061 – QUANTITATIVE ANALYSIS
SEMESTER 1 2020
Group (WIL) Assignment
Marks: 50
Due: Friday, Week 11, 11.59 PM
INITIAL INSTRUCTIONS:
1. This assignment consists of one practical application with eight aspects to your report.
2. Ensure this assignment, and the related dataset co
esponds to your enrolled lecture class (Monday,
Wednesday or Friday).
3. You must submit this assignment online via the Canvas link
a. Do not include the Excel document in your submission
. Only the written report is required.
4. Before beginning work read both Appendix 1 and Appendix 2 (the marking ru
ic) for important
information. Appendix 3 is important to the work you will need to do.
5. This is a group assignment. The minimum group size is two and the maximum is five. You must submit
the following table completed with your agreed percentage of contribution for each group member. All
group members will receive marks according to the percentage of contribution mutually agreed by the
whole group. If it is decided that everyone contributed equally, indicate the contribution % as 100% for
each group member. Any issues in regard to this must be resolved before submission.
Group Members:
First name Last name Student ID Contribution
%
Signature
ECON1061 – Group Assignment, Semester 1, 2020 Page 2 of 11
6. Complete the Agile Ways of Working micro‐credential (worth 2 marks). You may access this through
ECON1061Canvas site by clicking "Modules" on the left‐hand sidebar and navigating to the Creds module.
The unique URL is required for submission in this assignment. Please include the link in the cover
sheet/front sheet of the assessment (see Assignments ‐ Group Assignment (WIL Project) information in
CANVAS for more details).
7. You can find industry feedback from KPMG, one of Australia's Big Four on our (past) WIL project under
‘Assignments – Group Assignment (WIL Project) Information’ in Canvas. Reflect on this feedback from
a different industry (Australian Cattle & Sheep), to identify similarities and links between your WIL project
and the type of work done by an industry leader in the economics sector.
1 Introduction and Overview
In this assessment task you will take the role of an expert Quantitative Analyst employed by a
government organization in Australia. Government decision makers heavily rely on the advice of
experts like you when formulating policy or making important developmental decisions.
You are to conduct an in‐depth industry analysis, as outlined in Section 2.
As you write the report, keep in mind that the audience is other expert economists. Employ the
co
ect economic terminology and assume the readers have an understanding of the underlying
economic theory. Your report must be short but comprehensive, including all key facts and
details. Your report should not exceed six pages of A4 (including references and any Appendix).
The font used should be Arial 12pt. Margins should be set at 2.54cm and header & footer at
1.25cm, include page numbers in either the header or footer.
2 Task
The Australian Agriculture, Forestry and Fishing Support Services industry plays a significant role
in the Australian economy. Recently climate change and its impacts have attracted much
attention globally. Climate change poses challenges for all sectors of the Australian economy but
particularly for those sectors dependent on natural resources, such as agriculture, forestry and
fisheries.
ECON1061 – Group Assignment, Semester 1, 2020 Page 3 of 11
You are tasked with producing an Economic Impact Assessment of Australia’s Agriculture,
Forestry and Fishing Support Services industry. In addition, you need to assess in general terms
how climate change impacts in developing countries, e.g. China can impact Australia’s
Agriculture, Forestry and Fishing Support Services industry in the long run.
Economic impact assessment is about how one industry sector (or a project or activity within
that sector) affects other sectors in the economy. Input‐output tables are often used to identify
elationships between sectors within an economy.
The data required for this task can be found in the ‘Assignment Data’ Excel file1. This data
consists of 32 Australian industries, including the Agriculture, Forestry and Fishing Support
Services industry. The external demand (e.g. from the government, exports, etc.) of the dollar
amounts for each industry is also provided.
3 Benchmark Report and Expectations
For the expected report style see Appendix 1. You should treat the KPMG2 2015 Economic
Impact Assessment of the Tasmanian Aquaculture Industry as the benchmark for your report
writing style. This report is available in Canvas under “Assignments”.
If you need any additional statistics about the designated industry, please use the following link:
http:
www.abs.gov.au. Some other useful references are given in Appendix 1.
1 If you are interested, the full and original data can be found using the following link:
http:
www.abs.gov.au/Ausstats/
[email protected]/0/65123D449688A658CA2576470014F947?OpenDocument
2 KPMG is a global professional service company, one of the Big Four, https:
home.kpmg.com/au/en/home.html
ECON1061 – Group Assignment, Semester 1, 2020 Page 4 of 11
It is expected that your report should cover:
a) The significance of the Australian Agriculture, Forestry and Fishing Support Services industry
to the Australian economy in general (note: only a discussion similar to Section 2 (including Table
1) of the KPMG report is expected).
) A discussion of the challenges the Australian Agriculture, Forestry and Fishing Support Services
industry faces now and the impact these challenges may have on the Australian Agriculture,
Forestry and Fishing Support Services industry in the long term (note: only a discussion is
expected).
c) i. Calculate and report the Type I multipliers for all 32 industries.
(To equip you for calculating the technology matrix, first watch the video podcast on calculating
a technology matrix for a larger economy, that is available under “Assignment help” on Canvas.
Also refer to Appendix 3 for a simple explanation using a three‐sector economy)3.
ii. Explain the Australian Agriculture, Forestry and Fishing Support Services industry’s Type I
multiplier.
iii. Among the 32 industries identified, name two Australian industries that are important to the
Australian Agriculture, Forestry and Fishing Support Services industry (note: use the technology
matrix developed in Part C(i) to make your decisions). Discuss why you think they are important
to the Australian Agriculture, Forestry and Fishing Support Services industry (note: only a
discussion is expected).
d) A supposition that in the latest budget that the Australian Government has declared
significant cuts to the transport and support services industry and to the poultry and other
livestock industry. In fact, it has decided to cut the external demand for transport and support
services by 20% and for the poultry and other livestock industry by 15%. Discuss the impact of
this on the Australian Agriculture, Forestry and Fishing Support Services industry. Discuss which
industry (outside transport and support services and poultry and other livestock industry and
Australian Agriculture, Forestry and Fishing Support Services industry) will be most heavily
3 A similar type of analysis is ca
ied out in the KPMG report, page 11. The formula the KPMG report used is suitable
for calculating the individual multiplier for each individual industry, whereas the one explained in Appendix 3 is
suitable for collectively calculating multipliers for all industries at once.
ECON1061 – Group Assignment, Semester 1, 2020 Page 5 of 11
impacted by these budget cuts and possible reasons for why this other industry would be
affected. Express the change in the other industry’s output in percentage (note: Leontief Input‐
Output analysis, that is, total output = is expected (please refer to tutorial or lecture
examples), you can use the same 1I M matrix developed in part c(i)).
e) Climate scientists say there will be winners and losers from climate change. Take China as an
example and discuss in detail whether China will be a winner or loser and how this in turn will
impact (positively or negatively) Australian agribusiness sector in the long run.
f) Discuss how climate change can impact Australia’s exports in general. Outline three things you
can do to reduce the impact of climate change in Australia.
g) Provide a
ief literature review (similar to Table (2) of the KPMG Report) explaining the main
findings of at least two research papers relevant to your research report. More references, where
appropriate, are welcome.
h) Based on your analysis on the Australian Agriculture, Forestry and Fishing Support Services,
provide recommendation(s) to the Australian government (if any).
ECON1061 – Group Assignment, Semester 1, 2020 Page 6 of 11
Appendix 1
1. Finding the inverse
There are a couple of options to find the inverse of a matrix. The simplest is through Excel.
Please use the following website as a rough guide:
http:
www.excelfunctions.net/Excel‐Minverse‐Function.html
Important note:
The numbers in the table that you wish to find the inverse of must be rounded to 2 decimal
places before using the inverse formula. You will need to use the round formula
[=round(a
ay,2)] to achieve this outcome (where a
ay is the range of cells containing the
numbers you want to round).
Do not use the ‘increasing/decreasing the number of place’ command (the function as
shown in the picture below) as this will only ‘visually’ round the solutions to the number
chosen. You may, however, use this command when presenting solutions.
2. Excel tips
You will be performing most (if not all) of your calculations in Excel.
Various skills in Excel that may be useful to you can be found in this video:
https:
www.youtube.com/watch?v=G8w‐d9U3PJM
You may also want to freeze certain cells when dragging formulas down:
https:
www.youtube.com/watch?v=mvwmNxuiXO8
ECON1061 – Group Assignment, Semester 1, 2020 Page 7 of 11
3. Some useful research links:
a) https:
acola.org.au/wp/PDF/SAF07/social%20and%20political%20context.pdf
) https:
www.futurefarmers.com.au/young‐ca
on‐farmers/ca
on‐farming/climate‐
threats‐to‐australiaa‐agriculture
c) https:
www.inxsoftware.com/media/transfe
doc/agriculture_forestry_and_fishing_ind
ustry_report.pdf
d) https:
www.climatecouncil.org.au
esources/foodsecurityreport2015/
e) https:
www.science.org.au/learning/general‐audience/science‐climate‐change/7‐what‐
are‐impacts‐of‐climate‐change
4. Expected format of the report:
i) Abstract: a
ief outline of the report and the main findings
ii) Introduction: you can answer questions (a) – (f) here. Please include question numbers for
marking purposes.
iii) Literature Review: you can answer part (g) here
iv) Methodology: you can give a
ief introduction to input‐output analysis
v) Conclusions: a
ief summary of your findings
vi) Recommendations: you can answer part(h) here
Note: ideally, we prefer 6 pages in total or less. However, a little over (say 7 or 8 pages) is also
fine.
ECON1061 – Group Assignment, Semester 1, 2020 Page 8 of 11
Appendix 2: Marking Ru
ic
Criteria
(refer Section 3
above)
Unsatisfactory Satisfactory Good Very Good to
Outstanding
Task (a) Does not adequately
discuss (a)
(0 – 1 marks)
Partially discusses
(a), without
providing adequate
details (1.5 – 3
marks)
Somewhat
acceptable, but
could have
discussed more and
provided more
details
(3.5 – 4 marks)
(4.5 ‐ 5 marks)
Task (b) Does not adequately
discuss (b)
(0 – 1 mark)
Partially discusses
(b),
(1.5 – 3 marks)
Somewhat
acceptable, but
could have
discussed more
(3.5 – 5.5 marks)
(6 ‐ 8 marks)
Task (c) Calculations and
discussions were
wrong
(0 ‐ 0.5 mark)
Calculations co
ect
ut the discussions
were wrong
(1 – 2.5 marks)
Calculations co
ect
ut could have
discussed more
(3 to 4.5 marks)
(5 ‐ 7 marks)
Task (d)
Calculations and
discussions were
wrong
(0 ‐ 0.5 mark)
Calculations co
ect
ut the discussions
were wrong
(1 – 1.5 marks)
Calculations co
ect
ut could have
discussed more
(2 to 5 marks)
(5.5 ‐ 8 marks)
Task (e) Does not adequately
discuss (e)
(0 – 0.5 marks)
Partially discusses
(e)
(1 – 2.5 marks)
Somewhat
acceptable, but
could have
discussed more
(3 – 3.5 marks)
(4 – 5 marks)
Task (f) Does not adequately
discuss (f)
(0 – 0.5 marks)
Partially discusses
(f)
(1 – 1.5 marks)
Somewhat
acceptable, but
could have
discussed more
(2 – 2.5 marks)
(3 – 4.5 marks)
Task (g) Literature Review is
not done/does not
provide any
eferences
(0 marks)
Literature Review is
not
meaningful/only
one relevant
eference provided
throughout the
eport
(0.5 – 1 mark)
Literature Review is
somewhat
acceptable/only
two relevant
eferences provided
throughout the
eport
(1.5 – 2 marks)
Excellent Literature
Review/more
elevant references
provided
throughout the
eport
(2.5 – 3.5 marks)
Task (h) No recommendation
provided
(0 mark)
Meaningless
ecommendation is
provided
(0.5 – 1 mark)
Recommendation is
inadequate
(1.5 – 2 marks)
Solid
ecommendation
provided with
easoning
(2.5 – 3 marks)
Overall business
eport style and
presentation
(compared to the
enchmark report)
Not impressive
(0 – 0.5 mark)
Somewhat
acceptable
(1 – 1.5 marks)
Good effort
(2 – 3 marks)
(3.5 ‐ 4 marks)
Micro‐credential
(Agile Ways of
Working) Completion
Not completed
(0 mark)
Completed as
evidenced by
unique URL
submitted with the
assignment
(2 marks)
ECON1061 – Group Assignment, Semester 1, 2020 Page 9 of 11
Appendix 3: Explaining Type I multiplier calculation using a three‐sector
economy
Multipliers measure total change throughout the economy from a one unit change for a given
sector. In economics, three types of multipliers are calculated from model 1] output, 2] income
and 3] employment and these are refe
ed to as the Type I multiplier, Type II multiplier and Type
III multiplier, respectively.
Your assignment task covers only Type I multiplier which is calculated as follows:
Type I multiplier calculation and Interpretation:
Type I multiplier includes direct or initial spending + indirect spending or businesses buying and
spending to each other. Consider the input/output table for the three‐sector economy:
Input to ($million)
Agric. Health Services Other demands Total output
Output from
($million) Agric. 150 225 125 100 600
Health 210 250 140 300 900
Services 170 0 30 100 300
Step 1: Use the underlying assumption total input = total output to complete the following
input/output table
Input to
Agric. Health Services Other demands Total output
Output from
Agric. 150 225 125 100 600
Health 210 250 140 300 900
Services 170 0 30 100 300
Other inputs 70 425 5
Total input 600 900 300
ECON1061 – Group Assignment, Semester 1, 2020 Page 10 of 11
Step 2: Calculate the technology matrix, M, by dividing each column of inputs by total input
Input to
Agric. Health Services Other demands Total output
Output from
Agric. 150/600 225/900 125/300 100 600
Health 210/600 250/900 140/300 300 900
Services 170/600 0/900 30/300 100 300
Total
input 600/600 900/900 300/300
Thus =
150/600 225/900 125/300
210/600 250/900 140/300
170/600 0/900 30/300
=
XXXXXXXXXX
XXXXXXXXXX
XXXXXXXXXX
Step 3: Determine the inverse of ( – )
– =
1 0 0
0 1 0
0 0 1
XXXXXXXXXX
XXXXXXXXXX
XXXXXXXXXX
=
XXXXXXXXXX
XXXXXXXXXX
XXXXXXXXXX
=
XXXXXXXXXX
XXXXXXXXXX
XXXXXXXXXX
Note: You can use the Excel minverse function to calculate above inverse (please refer to
Appendix 1 for more detail). Remember to press ctrl, shift and enter keys together to get the
inverse.
ECON1061 – Group Assignment, Semester 1, 2020 Page 11 of 11
Step 4: Total requirements table and interpretation
Input to
Agriculture Health Services
Output from Agriculture 2.24 0.78 1.45
Health 1.54 1.92 1.72
Services 0.70 0.24 1.56
Total 4.48 2.94 4.73
The output multipliers are simply the column totals for each industry.
Interpretation: For example, agriculture Type I multiplier = 4.48. For a $1 change in final demand
sales in the local economy, the total direct and indirect impacts on the Agriculture sector is
$4.48.
Microsoft Word - TSGA15- Economic Impact Report FINAL 2805.docx
Economic
Impact
Assessment
Tasmanian Aquaculture Industry
Tasmanian Salmonid Growers Association
May 2015
kpmg.com.au
© 2015 KPMG, an Australian partnership and a member firm of the KPMG network of independent member firms affiliated with KPMG International Cooperative
(“KPMG International”), a Swiss entity. All rights reserved. The KPMG name, logo and "cutting through complexity" are registered trademarks or trademarks of KPMG International.
Liability limited by a scheme approved under Professional Standards Legislation.
Tasmanian Salmonid Growers Association
PO Box 321
Sandy Bay TAS 7005
28 May 2015
Dear Adam,
Economic Impact Assessment: Tasmanian Aquaculture Industry
KPMG, in association with Professor John Mangan from the University of Queensland, is pleased to provide
our study into the cu
ent economic contribution of the salmonid (Atlantic salmon and Ocean trout)
aquaculture industry to the Tasmanian economy.
In summary, our analysis has found that in terms of state wide economic impacts, the industry in Tasmania
cu
ently generates the following results per annum:
• average annual Turnover or Gross Output of $1.12 billion (the total value of industry production)
• annual Value added or net additions to Gross State Product (GSP) of $625.9 million (the added value
of industry production, equivalent to the GSP definition, as used by the Australian Bureau of Statistics)
• annual gain to factor income of $366.8 million (income paid to individuals and firms), and
• support for approximately 2,786 FTE jobs (full time positions employed in, or supported by the
industry).
The report also includes analysis of the economic significance of the industry’s leakage effect on the rest of
the Australian economy. The results highlight the importance of the industry to Tasmania and the rest of
Australia.
Yours sincerely,
David Richardson
Directo
© 2015 KPMG, an Australian partnership and a member firm of the KPMG network of independent member firms affiliated with KPMG International Cooperative
(“KPMG International”), a Swiss entity. All rights reserved. The KPMG name, logo and "cutting through complexity" are registered trademarks or trademarks of KPMG International.
Liability limited by a scheme approved under Professional Standards Legislation.
Executive summary
KPMG, in association with Professor John Mangan from the University of Queensland is pleased to provide
this report, which examines the cu
ent economic contribution of the Tasmanian salmonid (Atlantic salmon
and Ocean trout) aquaculture industry to the Tasmanian economy and the economic significance of its
leakage effect on the rest of the Australian economy. Key points to note are as follows:
• To undertake the analysis the combined economic operations of TSGA, Saltas, Huon, Petuna, Van
Diemen and Tassal were considered in aggregate, averaged over the period 2013/14.
• To estimate the total economic impacts of the operations in Tasmania, the combined expenditure
(cost) data from these companies were applied to the Tasmanian Non-Linear Model.
• This model was developed from an original table supplied by KPMG and modified to have marginal
coefficient properties by the IOW methodology developed at the University of Queensland.
• It is believed that this form of modelling is superior to traditional forms of Input/output modelling and
the most suitable form of economic model for this task.
• In the absence of a separate Aquaculture sector (not provided in sufficient detail by the ABS for
Tasmania) the coefficients from the Agricultural, Forestry and Fishing sector were modified to more
closely fit the expenditure patterns detected in the aquaculture industry and used to mi
or the
structure of the industry in Tasmania.
• In view of the leakage of activity to the rest of Australia a separate estimate of “Rest of Australia”
impacts was also estimated.
• It was found that the Tasmanian industry is part of a world-wide aquaculture industry that is
expanding and is believed to have significant production and commercial advantages in comparison to
wild- fisheries.
• By 2030, Aquaculture is anticipated to hold over 60% of the world fish market.
• It was found that given sufficient capitalisation, the Tasmanian industry has substantial opportunities
to expand exports.
In terms of state-wide economic impacts, the following results were generated:
• an average annual Turnover or Gross Output of $1.12 billion
• an annual Value added or net additions to GSP of $625.9 million
• an annual gain to factor income of $366.8 million, and
• support for approximately 2,786 FTE jobs.
This represents, in terms of the contemporary Tasmanian economy, 2.3% of State GSP, and 1.2 % of State
employment.
In addition, the operations of these companies contribute to the rest of the Australian economy, annually to
the tune of:
• an average annual Turnover or Gross Output gain of $180.9 million throughout the rest of Australia
• an annual Value added to GSP of $115.2 million
• an annual gain factor income of $69.1 million, and
• support for approximately 417 FTE jobs
Appendix 1 provides a summation of the