Month: October 2020

A budget takes any of the following forms: 1. Deficit budget If the proposed expenditure is greater than the planned revenue from taxation and miscellaneous receipts, this is a budget deficit. The excess of expenditure over revenue will be met Read More …

The budget is a summary statement indicating the estimated amount of revenue that the government requires and hopes to raise. It also indicates the various sources from which the revenue will be raised and the projects on which the government Read More …

The measures appropriate as remedies for unemployment will clearly depend on the type and cause of the unemployment. Such measures take the form of demand side (demand management) and supply side policies aimed at increasing aggregate demand and the economy’s Read More …

All countries suffer unemployment but most developing countries experience it at relatively higher degree and the following can be some of the types and causes: i) Transitional unemployment:- Transitional unemployment is that situation which prevails due to some temporary reasons. Read More …

Unemployment generally refers to a state/situation where factors of production (resources) are readily available and capable of being utilized at the ruling market returns/rewards but they are either underemployed or completely unengaged. When referring to labour, unemployment is considered to Read More …

Refers to the minimum rate of interest payable to persons to persuade them to part with money in terms of savings or investment i.e. interest being the payment for the loss of liquidity. It inversely relates the speculative demand for Read More …

Commercial banks “create” credit through a process known as credit creation. Credit creation is definedas a process by which commercial banks advance loans from deposits net of a statutory cash ratio requirement. This involves lending out money (from deposits) at Read More …

The Central Bank Governments need to hold their funds in an account into which they can make deposits and against which they can draw cheques. Such government deposits are usually held by the Central Bank. Commercial banks need a place Read More …

An expansionary monetary policy is to do with an increase in money supply which tends to have the following effects on an economy: Inflationary tendencies – an increase in money supply arising from an expansionary monetary policy such as a Read More …

The Transaction Motive A certain amount of money is needed for everyday requirements, the purchase of food and clothing and other ordinary expenses. How much is necessary to hold for these purposes will depend on 3 factors. A person’s income Read More …