Economics-For Managers


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Pages : 263;Paperback;
210 X 275 mm approx.

Pages : 250;Paperback;
210 X 275 mm approx.


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Workbook Price: Rs. 700;
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Economics For Managers, Management Textbook, Workbook

Macroeconomics : Banking and Money Supply : Chapter 18

The chapter started with a brief discussion of the Indian Financial System and the providers of financial services. Later, the services and functions of banks were also discussed. Money supply and various components of money supply were discussed at length. Various measures of monetary aggregates i.e. M1, M2, M3 and M4 were also examined.

The two approaches for determining the money supply, i.e., the multiplier approach and the structural approach, were analyzed. We then examined the process of creation of money and saw how the multiple expansion of money takes place.

The chapter also discussed various determinants of money supply. The behavior of the public and commercial banks when there is a change in the money supply was also noted.

The chapter concluded with a discussion of the process for determining the equilibrium in the money markets.

Chapter 18 : Overview

Indian Financial System
The Banking System
Accepting Deposits
Lending Money
Classification of Loans
Remittance Business

Money Supply
The Components Of Money Supply
The Measures of Monetary Aggregates

The Money Multiplier Approach
The Balance Sheet Approach or the Structural Approach

Creation Of Money And Banking System
Commercial Banks : Balance Sheet
Credit Creation
Multiple Expansion
Determinants of Money Supply
The Behavior of the Public
The Behavior of Commercial Banks
Influence of the Reserve Bank
Other Factors

Equilibrium In Money Markets
Changes in Equilibrium
Financial Development