Objectives of imf, Managerial Economics

Objectives of IMF

To achieve these objectives, the following conditions would have to be fulfilled: -

i.            Countries should not impose restrictions in their trade with each other.  This should encourage the growth of world trade and lead to full convertibility of currencies.

ii.           Countries should adopt the peg system of exchange rates, in which each country quotes the exchange rate of its currency in gold and thus the exchange rates between currencies can be determined.  The quoted exchanged rate is allowed to fluctuate to within 1% up and down, and the country can devalue or revalue its currency by up to 10%.  This was meant to stabilize exchange rates between currencies.

iii.         Each member state of the I.M.F should contribute to a fund to enable the I.M.F to give short-term assistance to countries having balance of payments problems. The quota contribution of the member state depends on the size of its G.D.P and its share of world trade. The member state contributed 25% of its quota in gold or convertible currency and the remaining 75% in its own currency.

iv.         A member state in balance of payments problems can borrow from the I.M.F on a short-term basis.  25% of the country's quota contribution is automatically available to it as stand-by credits.  Beyond this the country can borrow on terms dictated by the I. M. F. the country borrows by purchasing gold or convertible currency using it own currency.  The country's borrowing facility expires when the I.M.F. holds the country's currency twice the value of its quota contribution.  In paying back to the I.M.F. the country will repurchase back its currency using  gold or  convertible currency until the I.M.F holds 75% of the country's quota contribution in the country's currency.

v.          The I.M.F. reserves the right to dictate to the country borrowing from it how to govern its economy.

Posted Date: 12/1/2012 4:50:04 AM | Location : United States







Related Discussions:- Objectives of imf, Assignment Help, Ask Question on Objectives of imf, Get Answer, Expert's Help, Objectives of imf Discussions

Write discussion on Objectives of imf
Your posts are moderated
Related Questions
The significance of behavioural approach is difficult to assess. It provides useful insights into some aspects of business behaviour. March and Cyert have claimed considerable shor

they manufacture a single product, specialty curry sauce. They are interested in developing 12 MONTH budget models and want to perform decision analysis on this model. Curryrus.com

on the application of any of the concepts learnt in Managerial Economics. You may try to use these concepts to everyday problems in life or in any of the current debates on in the

Thinking about modifications in the model again: Go back to the original model again, but add a marginal propensity to invest, this is, suppose  that I = f ( i and Y). The MPI is d

The Budget line and its economic interpretation The indifference curve shows us consumer preferences but it does not show us the situation in the market place.  Here the consu

Use a computer regression package, to work these two computer exercises. 2. Ozark Bottled Water Products, Inc. hired a marketing consulting firm to perform a test marketing of its

“Managerial economics involves use of economic analysis to make business decisions involving the best use of a firm’s scarce resources” Explain the statement with suitable example.

Free disk space can be kept track of using a free list or a bit map. Disk addresses require D bits. For a disk with B blocks, F of which are free, state the condition under which t

In this question you will consider the impact on the building industry of the earthquake. Two construction and materials indices have been provided for the analysis.  If your famil

What is identity economics? How does identity economics help to explain economic questions that standard economics fails to address?