Definition of Money and Money Supply

-

Definition of Money :- 

Money is anything which is generally accepted as a medium of exchange, measure of value, store of value and means for standard of differed payment.

The term money is covers coins, currency, notes, cheque.

Functions of Money :-

There were two function of money.

1- Primary Function :-

• Medium of Exchange
• Measure of Value

2- Secondary Function :-

• Standard of Differed Payment
• Store of Value

Money Supply :-

It refers to the total volume of money held by the public at a particular point of time in an economy.

Comments

Post a Comment

Popular posts from this blog

Definition of Macroeconomics, Macroeconomic Policy, Targets,Objectives and its Conflicts

-
Macroeconomics :-   Macroeconomics is the branch of economics that studies the behaviour and performance of an economy as a whole. In focuses on the aggregate changes in the economy such as unemployment, growth rate, gross domestic product(GDP) and inflation.    Macroeconomic policy :-   It refers to the instruments by which a government tries to regulate or modify the economic affairs of the country in keeping view with certain objectives. "It attempts to assess the behaviour of the economy as a whole and to seek ways in which its aggregate performance might be improved". ● Policy Targets and Instruments :- •  Targets :- (a)- To achieve full employment at the rate of 3% unemployment. (b)-  To achieve price stability at an annual inflation rate of 5% per annum. (c)- To attain the growth rate of 5% per annum for the economy. ● Objectives of Macroeconomics Policy :- (a)-  Full employment (b)-  Balance of payment (c)-  Price Stability (d)-...
Read more

Monetary Policy, types and objectives

-
  Monetary Policy:- Monetary Policy is the Macroeconomic Policy and it refers to the credit control measures adopted by the Central Bank of a country. It is a demand side economic policy used by the government of a country to achieve macroeconomic objectives like- consumption, inflation, liquidity and growth. Monetary policy is set by a central bank. Types of Monetary Policy:- 1- Expansionary Monetary Policy 2- Contractionary Monetary Policy 1- Expansionary Monetary Policy:- It is also called as Easy Monetary Policy and used to overcome depression or a recession economic condition. When there is a deflation condition in an economy, the central bank starts an expansionary monetary policy that eases the credit market condition and leads to an upward in aggregate demand. It decreases the cost and availability of credit in the money market, and improves the economy. 2- Contractionary Monetary Policy:- It is also called as Dear Monetary Policy and used to overcome an inflationary gap. W...
Read more

Fiscal Policy, types and objectives

-
Fiscal Policy:- Fiscal policy means the use of government spending and taxation for stabilization of economic conditions. Fiscal policy is set by the government. Types of Fiscal Policy:- 1- Expansionary Fiscal Policy 2- Contractionary Fiscal Policy 1- Expansionary Fiscal Policy:- An Expansionary fiscal policy is used in unemployment and recession condition or deflation condition. Expansionary fiscal policy leads to the government lowering taxes or spending more or do both ( government lowering taxes and spending more) for improving the economy. 2- Contractionary Fiscal Policy:- An Contractionary fiscal policy is used in inflation condition. Contractionary fiscal policy leads to the government raises taxes or cuts spending or do both (raises taxes and cuts spending) for controlling inflation condition. Objectives of Fiscal Policy:- 1- To maintain and achieve full employment 2- To stabilise the growth rate of the economy 3- To stabilise the price level 4- To maintain equilibrium in t...
Read more