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A reverse repurchase agreement, or “reverse repo”, is the purchase of securities with the agreement to sell them at a higher price at a specific future date. For the party selling the security (and agreeing to repurchase it in the …

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 …

National Disposable Income = Net National Product at market prices + Other current transfers from the rest of the world The idea behind National Disposable Income is that it gives an idea of what is the maximum amount of goods …

Real gross domestic product (GDP) is an inflation-adjusted measure that reflects the value of all goods and services produced by an economy in a given year (expressed in base-year prices) and is often referred to as constant-price GDP, inflation-corrected GDP, …

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 …