Start Discovering Solved Questions and Course Assignments
TextBooks Included
Active Tutors
Asked Questions
Answered Questions
Flexible (or floating) exchange rate system: This is a system in which exchange rate is found out by forces of demand and supply of the foreign currencies concerned in the foreign exchange market. The
Fixed exchange rate system (or pegged exchange rate system): This is a system in which exchange rate of a currency is fixed by government. This system makes sure stability in the foreign trade and cap
Supply of foreign exchange: (A) By exports of services and goods(B) Direct foreign investment in residence country(C) For approximate purchases by non-residents in the home country(D) Remittances fro
Demand for foreign exchange is prepared to: (A) Purchase services and goods (B) Send gifts and funding(C) Speculate the value of foreign currencies, (D) Invest and procure financial assets
Explain how foreign exchange rate is determined beneath flexible exchange rate system. Beneath flexible exchange rate system, the equilibrium exchange rate is found out where demand for foreign exch
Implications of fiscal deficit: (A) High fiscal deficit entails a big amount of borrowings in which the government takes more loans to pay back it. It raises the liability of government. (B) This le
Fiscal deficit: Fiscal deficit is stated as the surplus of total expenditure over total receipts, apart from borrowings. Fiscal deficit = Total expenditure (Rev. Exp. + Cap. Exp.) – Total Recei
Capital expenditure: Any expenditure which will lead to formation of an asset or reduction in liability. This is financed out of capital receipts of government. Illustrations: Expenses on construction
Indirect taxes: Whenever the liability to pay tax is on one person and the burden of that tax falls on another person, it is termed as indirect tax. Illustrations are: sales tax, excise duty, VAT, tax
Direct taxes: Whenever the liability to pay tax and the burden of that tax fall on similar person, it is termed as direct tax. Illustrations are: wealth tax, income tax, corporation tax, gift tax and
Meaning of tax: Tax is a legally compulsory payment imposed on the people by the government. There are two kinds of taxes: Direct taxes and Indirect taxes.
Describe any two measures by which a Central Bank can attempt to decrease the gap. Answer: Central bank can decrease this gap by adopting two measures illustrated below: Bank rate: Central Bank mus
Elucidate the concept of deflationary gap. Answer: Deflationary gap is the deficit in aggregate demand from the level needed to maintain full employment equilibrium.
What possible fiscal policy actions can be taken with respect to expenses and income to accurate excess demand and deficient demand in economy? Answer: Fiscal measures to approved excess demand: Go
Define fiscal policy? Answer: Fiscal policy is the revenue and expenditure policy of government with a view to combat the state of inflationary or deflationary gap in economy.
Describe deficient demand in an economy? Determine its impact on output, employment and price? Answer: Deficient demand terms to the condition when aggregate demand (AD) is short of aggregate supply
Investment demand function: Investment demand function is the relationship among rate of interest and investment demand. There is an inverse relationship among the rate of interest and investment dema
Describe open market operations? What is its consequence on availability of credit? Answer: Open market operations signify the purchase and sale of government securities by the central bank from/to
Define bank rate policy? How does it operate as a technique of credit control? Answer: Bank rate is the rate at which the central bank provides loans to the commercial banks. The increase in bank ra
Describe functions of central bank? Answer: (A) Issue of currency: Central bank is the only authority for the issue of currency in country. (B) Banker to the government (both central and state gove
How does a commercial bank make money? Answer: Commercial banks are capable to make credit that is many times greater than deposits received by banks. Money creation or credit creation by the banks
Explain in short the functions of money? Answer: (A) Medium of exchange: Money can be employed to make payments for all transactions of services and goods. (B) Measure of value: Money works as a ge
Can someone please help me in getting through this problem. 1.0 gm of pure calcium carbonate was found to require 50 ml of dilute HCL for complete reaction. The strength of the HCL solutio
On passing H2S gas through a solution of Cu+ and Zn+2 ions, CuS is precipitated first because: (i) Solubility product of CuS is equal to the ionic product of ZnS (ii) Solubility product of CuS i
The distribution law is exerted for the distribution of basic acid among: (i) Water and ethyl alcohol (ii) Water and amyl alcohol (iii) Water and sulphuric acid (iv) Water and liquor ammonia What is