Service referred in the report
The product or the service referred in this report is about international education and training sector of South Australia . There has been continuous growth in demand for international education and also there had been a significant growth in the economy.
International education in Australia has an elastic demand. The reason behind this is that when the price of international education in Australia rises, affording it will become tough. Therefore, people will switch to some other countries for education. Therefore, international education in Australia has an elastic demand.
Market of the service
Demand for international education in Australia is quite high along with the training sector. It has been projected that the demand for international education in Australia will continue to increase over 7 million by 2025 . There is presence of lot of potential for growth in the educational and training sector of Australia. However, markets may grow slow as a result of shifts in demographic and economic factors. It may also face stiff competition from china, United Kingdom and Malaysia.
Substitute and complementary products
International education in South Australia had already contributed to around $954 million of total value added which represents 1% of the gross domestic product of Australia. Students opt for international education in South Australia based on different factors which may include cost of living, accommodations, employability and the rate of migration . The country already faces competition from markets in China, United Kingdom and Australia. Therefore the markets from these countries acts as a substitutes. Presence of substitutes makes the market for international education competitive. When the market for education in Australia becomes expensive the students will turn to other countries for education which provides similar course. Complementary of this sector may include accommodation facilities. When there will be increase in the flow of students the hotels will also earn more comparatively.
Positive economics mostly deals in facts and figures whereas normative economics does not deals with facts and are in fiction. Normative economics also depicts what the situation should be and positive economics on the verifiable facts that is already present. Positive economics also states cause and effects. The arguments in normative economics in subjective. This particular report has positive statements as the report consists of many facts and figures mentioned. The following report also states about the cause and effects relationship.
Shift in demand
When there is an increase in the demand for education in Australia the demand curve shifts upwards and the quantity demanded also increases. The factors which may lead to increase in demand for international education in Australia includes cheap course fees, presence of more relatives and friends and cheap accommodations . As the report states that the cost of living in South Australia is low and also Adelaide has a very large amount of accommodation options the demand of education in Australia can increase. 34% of graduate degree holders were already employed after the completion of course. All these suggests that there will be growth of this sector in the coming decade. All these suggests that there will be increase in demand and the demand curve shifts upward .
Influence of tax
When tax is imposed on education it will discourage the higher education. However, when the government increases it tax it will lead to increase in revenue. In order to promote education government provides subsidies to the international students . According to the taxing structure of Australia when a student is enrolled for a course for more than six months they are considered as a resident of Australia which means the tax rates will be much lower compared to the foreign residents.
Surplus of the product
There is surplus of the service of international education in Australia as can be detected from migration trend. The report suggests that there is upside growth of this service and the sector will also grow over the coming decade.
"International education in South Australia | Deloitte Australia | Deloitte Access Economics report, Public sector", Deloitte Australia, 2018. [Online]. Available: https://www2.deloitte.com/au/en/pages/economics/articles/international-education-in-south-australia.html. [Accessed: 28- Aug- 2018].
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