What is the meaning of economic growth?
Economic growth is an increase in the production of economic goods and services per head of the population over a specific period. It can be measured in nominal or real (adjusted for inflation) terms to be more accurate. Economists and statisticians use different methods such as Gross national product (GNP) and Gross Domestic Product (GDP)…
Read article
What is an expansionary monetary policy?
In the macroeconomic sense, an expansionary monetary policy is a form of monetary policy used by central banks that aims to surge the rate of monetary expansion to stimulate growth during a recession or in anticipation of a recession. When interest rates are already high, the central bank focuses on increasing the money supply and…
Read article
Objectives of Open market operations (OMO)
Open market operations (OMO) refer to buying and selling of government securities and treasury bills in the open market by the central bank of the country in order to expand or contract the amount of money in the banking system. The primary aim of open market operations is to regulate the money supply in the…
Read article
How do we measure the rate of inflation?
The inflation rate of an economy can be easily calculated by using the following formula: [CPI(c)-CPI (p) ÷ CPI (p)]×100 Where; CPI(c) is the consumer price index of the current year CPI (p) is the consumer price index of the previous year or initial consumer index For example, the CPI of the previous year was…
Read article
What are inflation and deflation in an economy?
In the economic dialect, inflation refers to the increase of the price level of commodities due to an increase in the quantity of money supply. During the period of inflation, the growth of money supply is faster than the level of productivity in the economy. On the other hand the term ‘deflation’ is used to…
Budget 2019 impact on individuals
The Union Budget for the financial year 2019-20 was presented by finance minister Smt. Nirmala Sitharaman in Parliament on Friday July 5, 2019. The major impact on budget 2019 proposal on common man is as follows. Individual tax payers with income up to Rs.5 lakh taxable income will get full tax rebate after permissible deductions…
Read article