Category Economy

 Grameen means “rural” or “village” in the Bangla language  Economic theory provides ample caution against lending to low-income households that lack collateral to secure the loans. The concept of effective demand, as applied to the theory of demand and supply,…

Microfinance has defined the methodology that employs effective collateral substitutes to deliver and recover short-term working capital loans to microentrepreneurs. The emergence of microfinance was a result of the poor performance of government programs set up in the 1960s and…

This theory was postulated by  Irving Fisher an American Economist in his book ‘The Purchasing Power of Money’  in the year 1911. This theory of money demand is classified under the classical theory of money demand In this theory of…

Economic growth implies the expansion in productive capacity or capital stock in the economy so that an increase in real national output or income is attained. Economic growth can be speeded up by accelerating the rate of saving and investment…

Money is defined as anything performing monetary functions. It must also be generally acceptable to every member of society. money has a value to individual X only when he thinks that individual Y will accept it in exchange for goods…

Monetary policy, however, plays a more limited role in developing countries for a number of reasons; Commercial banks in developing countries are less sensitive to changes in their cash base partly because many banks find themselves with excess liquidity because…

Some of the objectives of monetary policy seem to be conflicting and mutually contradictory Full Employment and Balance of Payment Equilibrium – Similarly while maximizing domestic employment and economic growth, a balance of payment deficit is bound to emerge. With…

It is important to understand the distinction between objectives or goals, targets and instruments of monetary policy Goals   of monetary policy refer to the objectives (price stability, economic growth or full employment) while targets refer to variables such as the…

Monetary policy is one of the public interventionist measures aimed at influencing the level and pattern of economic activity so as to achieve desired goals. It covers all the actions by the Central Bank which influence the quantity, cost and…

A central bank is an authority responsible for policies that affect a country’s supply of money and credit. The central bank uses its tools of monetary policy to affect short term interest rates and the monetary base in order to…