Skip to main content

Land utilisation

  LAND UTILIZATION  Land is a scarce resource, whose supply is fixed for all practical purposes. At the same time, the demand for land for various competing purposes is continuously increasing with the increase in human population and economic growth.Land use pattern at any given time is determined by several factors including size of human and livestock population, the demand pattern, the technology in use, the cultural traditions, the location and capability of land, institutional factors like ownership pattern and rights scale regulation. Major Types of Land Utilization in India : As in all other countries, land in India is put to various uses. The utilization of land depends upon physical factors like topography, soil and climate as well as upon human factors such as the density of population, duration of occupation of the area,land tenure and technical levels of the people.There are spatial and temporal difference in land utilization due to the continued interplay of phys...

Foreign exchange rate

FOREIGN EXCHANGE RATE

Foreign exchange rate refers to the rate at which one unit of currency of country can be exchanged for number of units of currency another country. It is the price paid in domestic currency in order to get one unit of foreign currency.
Thus,it expresses the ratio of exchange between currencies of two countries . It is also refer to as external value of the currency.

System of exchange rate
There are two systems of exchange rate:
a)Fixed exchange rate system
b) Flexible exchange rate system

Fixed exchange rate system refers to rate of exchange as fixed by the government. It has two important variants , historically.
1)Gold standard system of exchange rate
b)Bretton woods system of exchange rate

Gold standard system 
According to this system of exchange rate,gold was taken as common unit of parity between currencies of different countries in circulation. Each country was to define value it's currency in terms of gold. Thus,value of one currency in terms of other currency was fixed considering gold value of each currency. This system is also known as Mint Par value of exchange rate.

Bretton woods system
According to this system of exchange rate,even when it was a fixed system ,it still allowed some adjustments. It was also called as adjustable peg system of exchange rate. According to this, different currencies were pegged to one currency that is US dollar. It was assigned gold value at fixed price. Value of one currency in terms of US dollar ultimately applies value of that currency in terms of gold.


Flexible exchange rate
Flexible exchange rate is that rate which is determined by the demand for and supply of different currencies in the foreign exchange market. In other words, it is determined by market forces ,like price of any other commodity. The market where foreign currencies are demanded and supplied is called foreign exchange market or international Money market.
The exchange rate at which demand for foreign currency is equal to its supply is called Par rate of exchange and it constitutes the Normal or equilibrium rate.
It is flexible rate because it tends to change in accordance with changes in supply and demand conditions in international money Market.

Comments

Popular posts from this blog

BASICS OF MACROECONOMICS

Basics of Macroeconomics   a) Capital goods : Capital goods are described as fixed assets of producers which are used in the process of production for several years. Plant, heavy equipment, machinery are examples. b) Investment : Investment is a process of capital formulation also known as the process of increase in stock of capital .             I =∆k Where I is investment and ∆k refere to the change in capital stock during the year. There are two types of investment  Fixed investment refers to increase in stock of fixed assets of producers during the period of an accounting year .Plant ,machinery are some of its examples.It is also called as fixed capital formation. Inventory investment are those stock which keeps varying . At a point of time,producers have stock of finished goods ,semi finished goods or raw material . These are called as inventory investment. Change in the stock of these are called as inventory investment of producers. c) D...

Insolvency and bankruptcy code

  Insolvency and bankruptcy code (IBC) 2016 IBC 2016 is a code which is not applicable to financial institutions like banks, pension funds, mutual funds. This means if company has taken loan from a bank and is not making repayment of its debt, bank can then move to National company law tribunal under IBC 2016 to declare the company bankrupt. To deal with the bankruptcy of financial institutions, Government is planning to bring " Financial Resolution and Deposit Insurance " (FRDI) bill. It is a system to deal with financial firms insolvency while at same time providing highest level of safety to the depositors .  This law is in dicussion since last 4 to 5 years, but still not passed by the parliament due to "Bail - in "clause. It states that in case there is bankruptcy or insolvency in bank, then depositors will have to give up some parts of their deposit to protect the bank. There is disagreement on this clause.  To conclude, The FRDI bill, 2017 was mea...

SAARC

SOUTH ASIAN ASSOCIATION FOR REGIONAL COOPERATION (SAARC) Introduction    The South Asian association for regional cooperation comprises of Afghanistan, Bangladesh, Bhutan, Indian, Maldives, Nepal, Pakistan and Sri Lanka. The foreign ministers of these countries, at their first meeting in New Delhi in August 1983,adopted the declaration on SAARC and formally launched its Integrated Programme of Action IPA. SAARC has also nine observers - Australia, China, EU , Iran, Japan, Republic of Korea, Mauritius, Myanmar and USA. Meaning  The aim of the organisation is to accelerate the process of economic and social development in Member states joint action in agreed areas of cooperation. Observers are not allowed to be part of deliberations and their participation is limited to the inangural and closing sessions of the summit. Objectives   a)To promote the welfare of the people of South Asia and to improve their quality of life. b)To accelerate economic growth, social progess ...