--%>
Assignment Help - homework help

Monetary liability

All currency issued by central bank is its monetary liability. Explain how?

Answer: The Central Bank is grateful to back the currency with assets of equivalent value. Such assets generally include of gold coin, foreign securities, gold bullion, and the domestic government’s local currency securities. The country’s Central government is generally authorized to borrow money from the central bank. Government does this, by selling local currency securities to the central bank. Whenever the central bank acquires such securities, it issues currency. Putting and withdrawing currency into and from the circulation is as well the job of central bank.

   Related Questions in Microeconomics

  • Q : Subjective preferences of Marginal

    I have a problem in economics on Subjective preferences of Marginal Utility. Please help me in the following question. The Marginal utilities: (1) Reflect the subjective preferences. (2) Are realistically evaluated by wealth. (iii) Are set by the demo

    		•
  • Q : Entry of new firm in monopolistic

    Entry of new firms within a monopolistically competitive market: (1) is preventable. (2) may decrease the established firm’s production costs. (3) increases the established firm’s profits. (4) shrinks demand for a successful firm’s p

    		•
  • Q : Demand curve for physical capital The

    The demand curve for physical capital: (1) does not depend on the amount of labor available. (2) generates a supply of loanable funds to finance new investment. (3) depends onto the marginal productivity of capital. (4) is exactly parallel to the amou

    		•
  • Q : Price discriminate for maximizing profit

    Monsieur Cournot has a monopoly on an artesian well from that flows tasty spring water reputed to have medicinal properties. To ignore incurring variable costs, he is adamants that customers bring their own pails and also fill them in

    		•
  • Q : Short-run supply curve for a

    For a competitive firm, the short-run supply curve is the portion of its: (w) AVC curve that lies above the ATC curve. (x) MC curve which rises above its AVC curve. (y) MC curve which is upward sloping. (z) AFC curve which lies above the MC curve.

    		•
  • Q : Marginal revenue with price discriminate

    For any firm along with some degree of market power but that cannot price discriminate, the price is: (w) constant along the demand curve. (x) identical with marginal revenue. (y) greater than marginal revenue. (z) less than marginal revenue.

  • Q : Vigorous competition in long run market

    Vigorous competition into a market depends in the long run most strongly upon the: (w) number of buyers and sellers presently in the market. (x) freedom to enter and exit the market. (y) sizes of the average firm within the market. (z) uniformity [hom

    		•
  • Q : Earning income under negative income tax

    Under the negative income tax system demonstrated in this figure, a family of four along with earned income of $15,000 yearly would have a net [after-tax] income of: (i) $30,000 per year. (ii) $27,500 per year. (iii) $25,000 per year.

    		•
  • Q : Investor Optimism for Loanable Funds An

    An increase within investor optimism will cause: (w) interest rates to rise. (x) slower technology advances. (y) slumps in business construction. (z) interest rates to fall. Please choose the right answer from abov

    		•
  • Q : Output level of maximized profit Profit

    Profit is maximized in illustrated graph when this lumber mill produces an output level of: (1) 600 generic 2×4s daily. (2) 700 generic 2×4s daily. (3) 1500 generic 2×4s daily. (4) 1700 generic 2×4s daily. (5) 1800 generic 2&ti

    		•