Economic and Social Development

Open Economy Before proceeding to study the external sector, it is very important to understand what Open Economy is. An open economy is one that trades with other nations in goods and services and, most often, also in financial assets. Total foreign trade (exports + imports) as a proportion of GDP is a common measure …

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Functions of Government Budget Primarily, there are three functions or requirement of Government budget such as: Allocation, Distribution and Stabilization of resources of government. Let’s discuss them one by one: Allocation Function: Certain goods, referred to as Public goods, such as roads, national defense, government administration, are cannot be provided through the market mechanisms. These …

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What is Money? Money is an officially-issued legal tender generally consisting of notes and coin, and is the circulating medium of exchange as defined by a government. Money is often synonymous with cash and includes various negotiable instruments such as checks. Each country has its own money that is used as a medium of exchange …

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If we measure the GDP of a country in two consecutive years and see that the figure for GDP of the latter year is twice that of the previous year, we may conclude that the volume of production of the country has doubled. But it is possible that only prices of all goods and services …

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