This is done by issuing sufficient monetary instruments when required. The Central banks also help the government in designing the currency of the country, which includes all the unique features. 2. It is involved in regulating and co-coordinating with the government and the stated economic policies of the country. 3. The interest rates are also controlled by the central banks to maintain price stability within the country. It also has to keep a track of the inflation in the market. The Central Banks of all the countries have an effective plan for managing the public debts. They do this through the sales and purchase of government papers such as bonds and securities. 4. The Central Bank is also known as a banker's bank. This means that the commercial banks of the countries are also regulated by the Central banks of the respective country. The Central bank not only regulates them but also provide adequate financial assistance in time of need. 5. The central bank needs to ensure the proper functioning of the financial systems within the county. They regulate the banking system within the country and are answerable to the world market (Downes & Vaez-Radeh, 1991). Balance Sheet Analysis The Balance Sheet of Central Banks has the list of all the liabilities and the assets that the Central Bank possesses. It is important to study the balance sheet of the Central banks in order to understand how they implement the monetary policy because the balance sheet reflects the sales, purchase records of the Central Bank and also states the holding. The Central Bank is the in charge for issuing the country's currency and it also posses the power to eliminate the power of the currency. In short, we can say that the balance sheet shows the true picture of the actions of the Central Bank. The balance sheet of a Central Bank focuses on three main components: bankers to commercial banks, Issuing the nations' currency and banker to the government of the country (Jadhav, 2006, p. 246). The Balance Sheet needs to be analyzed from two viewpoints such as: as an issuer of currency and duty to maintain the price stability and the growth of the economy through attaining the monetary policies of the countries' economy. It is important to know certain important perspectives to understand the balance sheets of the Central banks. Firstly, the central banks are fully government owned. There are very few exceptions, but in that case there are certain restrictions on the share-holding patterns. Secondly, Central banks are the only banker for the government of ever nation. Finally, the Central bank also has to take care of the public debt. It has to always see that the net foreign asset is higher compared to the currency, so as to see that the domestic demand of foreign currency is duly met The monetary base The two components of money supply are monetary base and money multiplier. Monetary base includes the reserves and the outstanding currency of the economy. It comes in the asset side, in the balance sheet, of the central bank. It links the central banks to the other measures of the money supply. So we can
Cite this document
(“The relationship between price and Money Supply Research Paper”, n.d.)
Retrieved from https://studentshare.net/business/9027-central-banks-monetary-policy
(The Relationship Between Price and Money Supply Research Paper)
“The Relationship Between Price and Money Supply Research Paper”, n.d. https://studentshare.net/business/9027-central-banks-monetary-policy.
Cited: 0 times
Central banks and monetary policy Table of Contents Objectives of Central Banks 3 Balance Sheet Analysis 4 The monetary base 5 The money supply 5 Role of banks in the money supply process 6 Central Bank’s Control on Money Supply 6 The relationship between price and Money Supply 7 Price Stability and other goals of Central Banks 9 Price Stability 9 Other Goals of Central Banks 10 References 15 Objectives of Central Banks Central banks are government bodies involved in the management of the money supply, the currency and the interest rates of the nations…
The relationship between advanced technology and Green supply chain. Green movements emanate from the need to address environmental problems that have become unmanageable for the last decades despite international organizations’ efforts. Green supply chain programs address a web of concerns (diagram below) with the end goal to meet profit expectations but at the same time placate customer, regulatory, as well as community demands with regards to arresting environmental degradation.
In this paper, the four variables considered that in relationship between revenue management and pricing strategies in airline industries includes the uncertain nature of the pricing process based on the fact that prices developed under revenue management processes use models and demand forecasts. The motives that drive the revenue management efforts do not always come with the need to make profit.
There is variation in price depending on the commodity type to be sold, in the property market. Nevertheless, in any decision-making as regards the property market, it is true that the price mechanism should be taken into consideration as a sales determinant; that is the higher the price the lower the rate of purchasing and the reverse is true.
But definition alone cannot be proof enough of the virility that it has cast on common man’s lives on a global basis. What had started with mere disputes in demand- supply equilibrium in the real estate market has turned out to be the biggest evil, spreading its grasps on almost everything that it has touched.
They basically seek a reduction in risk before investing their money (Smets 1260). Due to this, decision makers need clarity about price rises, joblessness, interest rates plus economic escalation. The government can influence these factors through monetary policy (MCcallum 1787).
Since this time, MDMA has attracted a great deal of research with respect to the longterm effects that use and overuse of this particular drug has upon the individual. A great majority of this research has been concentric upon the after-effects of use and overuse with regards to the side effect of depression that often ensues following heavy MDMA usage.
Regardless of the large number of studies regarding positive correlation between contributions and congressional voting behaviour the question on whether contributions “buy” votes in congress remain unanswered. Nevertheless, the paper tries to assess the causal link between contributions at the time of campaign and politicians’ voting behaviour; however, the correlations never characterize valuable estimates of the impact of the monetary gifts on polling trends because donations given at the time of campaign are internally determined by various factors like a legislator’s beliefs.
This is vital to any developed or developing economy (FRBSF, 2001). In addition, the lending role of commercial banks is the means through which money supply in any economy or financial system alters in reply to the ups and downs of the business cycle. Banks actions are vital determinants of credit and money development, both of a recurring, as well as of a more constant nature.
The paper describes the International Relations between EU and Ukraine during 2012-2014 within conclusion of Association Agreement by EU and Ukraine. The Ukraine political system which does not encourage democracy might also have been a hindering factor to the good relationship between the EU and Ukraine.
One of the important aspects of an economy that highlights its growth prospect in context of international business is gross national product or gross national income. Unlike Gross Domestic Product, GNP takes in consideration foreign trade activities.
8 pages (2000 words)Research Paper
Got a tricky question? Receive an answer from students like you!Try us!
Let us find you another Research Paper on topic The relationship between price and Money Supply for FREE!