Class 12 Macro Economics - Chapter Money and Banking NCERT Solutions | What is High Powered Money?

What is a barter system? What are its drawbacks?

What are the alternative definitions of money supply in India?

What are the main functions of money? How does money overcome the shortcomings of a barter system?

What is transaction demand for money? How is it related to the value of transactions over a specified period of time?

What is money multiplier? What determines the value of this multiplier?

Explain the functions of a commercial bank.

What are the instruments of monetary policy of RBI?

What role of RBI is known as ‘lender of last resort’?

Do you consider a commercial bank ‘creator of money’ in the economy?

What is a ‘legal tender’? What is ‘fiat money’?

What is marginal propensity to consume? How is it related to marginal propensity to save?

Explain why public goods must be provided by the government.

Differentiate between balance of trade and current account balance.

What are the four factors of production and what are the remunerations to each of these called?

What is the difference between microeconomics and macroeconomics?

What is the difference between ex ante investment and ex post investment?

Distinguish between revenue expenditure and capital expenditure.

What are official reserve transactions? Explain their importance in the balance of payments.

Why should the aggregate final expenditure of an economy be equal to the aggregate factor payments? Explain.

What are the important features of a capitalist economy?

What are the important features of a capitalist economy?

Explain why public goods must be provided by the government.

Measure the level of ex-ante aggregate demand when autonomous investment and consumption expenditure (A) is Rs 50 crores, and MPS is 0.2 and level of income (Y) is Rs 4000 crores. State whether the economy is in equilibrium or not (cite reasons).

Explain why the tax multiplier is smaller in absolute value than the government expenditure multiplier.

What are the four factors of production and what are the remunerations to each of these called?

Write down the three identities of calculating the GDP of a country by the three methods. Also briefly explain why each of these should give us the same value of GDP.

Differentiate between balance of trade and current account balance.

From the following data, calculate Personal Income and Personal Disposable Income.
                                                                               Rs (crore)
(a) Net Domestic Product at factor cost                    8,000
(b) Net Factor Income from abroad                              200
(c) Undisbursed Profit                                                1,000
(d) Corporate Tax                                                         500
(e) Interest Received by Households                         1,500
(f) Interest Paid by Households                                  1,200
(g) Transfer Income                                                       300
(h) Personal Tax                                                            500

Describe the Great Depression of 1929.

What is the difference between microeconomics and macroeconomics?