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Money multiplier is a term in monetary Economics that is a phenomenon of creating money in the economy in the form of credit creation, based on the fractional reserve banking system. Money multiplier is also known as the monetary multiplier. …

Money is the commonly accepted medium of exchange. In an economy which consists of only one individual there cannot be any exchange of commodities and hence there is no role for money. Even if there is more than one individual …

The first and leading role of money is that it functions as a mode of exchange. Barter exchanges become exceptionally tough in a large economy because of the high prices people would have to sustain looking for proper people to …

The demand for money tells us what makes people desire a certain amount of money. Since money is required to conduct transactions, the value of transactions will determine the money people will want to keep: the larger is the quantum …

The money supply is all the currency and other liquid instruments in a country’s economy on the date measured. The money supply roughly includes both cash and deposits that can be used almost as easily as cash. Governments issue paper …

Assets are the first of three major categories on the balance sheet.Current assets represent the value of all assets that can reasonably expect to be converted into cash within one year and are used to fund ongoing operations and pay current expenses. …

Current liabilities are short-term liabilities that are due within one year and include:  Accounts payable are a short-term debt owed to suppliers. Accrued expenses are expenses that have yet to be paid, but have a high probability of being paid. Non-current liabilities are …

A balance sheet should always balance. The name “balance sheet” is based on the fact that assets will equal liabilities and shareholders’ equity every time. Understanding Balance Sheets The assets on the balance sheet consist of what a company owns …

Cash Reserve Ratio (CRR) is the amount of funds that banks have to maintain with the Reserve Bank of India (RBI) at all times. If the central bank decides to increase the CRR, the amount available with the banks for disbursal …