Monetary policy, Managerial Economics

Monetary Policy

Meaning of Economic Growth: The primary function of an whether socialist or capitalist is to satisfy people maximum wants. It must produce consumer goods to make high standard of living for the people a reality. In a free market economy, there is enough sense in saying that consumer is the king because it is he who determines the types and the quantities of goods which the producers would produce in the economy. In a totalitarian economy, the situation is however, different. there the decision regarding what and tow much is to be produced are taken by the few top government officers representing the omnipotent state. The credit mechanism can help in facilitating to achieve this in the economy. Money is the means to achieve an end. Economic growth does not mean higher money income without being accompanied by higher real income. Economic growth means both quantitative and qualitative increase in the quantity of both the goods and services produced in the economy annually.

In short growth means three things. Firstly, it implies an increase in the total physical or real output in the economy. Secondly, the composition and quality of the goods and services produced due to growth should satisfy consumer wants because in the ultimate analysis satisfaction of human wants is the end all economic activities. Thirdly, economic growth should be achieved within the framework of economic freedom. Broadly speaking, economic growth implies sustained increase in the per capital real income. This does not, however mean that economic growth as an objective of monetary policy excludes consideration of important issues like the composition of output between the consumption and the investment goods and the distribution of national income between the different functional classes in the economy.

Posted Date: 12/1/2012 5:28:10 AM | Location : United States







Related Discussions:- Monetary policy, Assignment Help, Ask Question on Monetary policy, Get Answer, Expert's Help, Monetary policy Discussions

Write discussion on Monetary policy
Your posts are moderated
Related Questions
THE BALANCING ITEM Since for ever position entry in the current and capital accounts there is a corresponding negative entry in the monetary account, and for every negative en

The quantity theory of money In the 17 th Century it was noticed that there was a connection between the quantity of money and the general level of prices, and this led to th

Q. What do you mean by Kinked Isoquant? This isoquant presumes only limited substitutability of labour andcapital. There are just a few processes for generating any one commodi

Find price for demand of 105000 exhaust fans, function is 462-5/7q for demand and p-6/7q for supply. find supply at 312, equilibrium qt and price

What is Risk and Production analysis Risk analysis:  Various models are used to quantify risk and asymmetric information and to employ them in decision rules to manage risk.

CHARACTERISTICS OF THE THREE STAGES   Stage I Here the Total Physical Product, Average Physical Product and Marginal Physical Product are all increasing.  However MPP

The most significant uses of the price elasticity of demand, used specifically in business decision-making. It refer to the relationship between price elasticity and the marginal c

features of monopoly?

Q. What do you mean by Ordinal utility? A method of analysing utility or satisfaction derived from consumption of services andgoods, based on a relative ranking of services and

MONEY MARKETS The expression "money markets" is used to refer to the set of institutions and individuals who are engaged in the borrowing and lending of large sums of money