--%>
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 : Problem on Labor Unions and Wages The

    The Industrial unions try to accomplish wage rates above the competitive level through: (i) Limiting the supply of labor to the industry. (ii) Raising the supply of labor. (iii) Raising the productivity of the labor in an industry. (iv) Member’s agreeing to work

    		•
  • Q : Aggregate Supplies of Labor The

    The Supplies of labor from a specified population mainly depend on the: (1) Structure of wage rates. (2) Labor force participation rates of different population sub-groups. (3) Individual preferences for the work and income versus the leisure. (4) Levels of investment

    		•
  • Q : Occurrence of economic profits in a

    Entry within a competitive industry will continue till: (w) accounting losses are driven to zero. (x) economic profits equal accounting losses. (y) bookkeeping profit approaches zero. (z) economic profits are driven to zero. Can an

    		•
  • Q : Another name of micro economics What is

    What is another name of micro economics? Answer: Price theory

    		•
  • Q : All possible prices exceeding in

    Participants in this market would experience a surplus in this market for teleporter buttons: (1) at all possible price per button exceeding P2. (2) equal to distance cd when the price per button equals P1. (3) when this market was primarily in e

    		•
  • Q : Equilibrium quantity and price

    Elucidate the consequence of an increase in demand of a commodity on its equilibrium quantity and price? Answer: Increase in demand causes a rightward shift in the

    		•
  • Q : Comparing monopolistic competition to

    If comparing monopolistic competition to pure competition within the long run: (w) product differentiation definitely improves social welfare. (x) only monopolistic competitors may earn economic profits. (y) only pure competitors oper

    		•
  • Q : Valuable human capital The maximum

    The maximum valuable human capital on the given list would be possessed by the person who: (1) Inherited a big deal of money. (2) Invested big sums on stock market. (3) Had an advanced degree in the music education. (4) Specialized as the medical doctor.

  • Q : Problem on equal marginal utilities per

    Substitution takes place when prices change and hence demand curves are negatively-sloped since of the behavior of consumers which most directly underpins the law of: (1) Equivalent marginal utilities per dollar. (2) Diminishing net utility. (3) The income effect. (4)

    		•
  • Q : Maximum economic profit operates in new

    When this competitive firm operates at point d in demonstrated graph, in that case this: (w) could increase profits by expanding output to q5. (x) maximizes economic profit [ as area P2P1de], but these profits will eva

    		•