National debt, Managerial Economics

Assignment Help:

NATIONAL DEBT

Taxation does not often raise sufficient revenue for the Government Expenditure.  So, governments resort to borrowing.  This government borrowing is called Public debt or National debt, it thus refers to the government total outstanding debt.  This debt increases whenever the government runs a deficit for then it has to borrow to pay for the excess of expenditure over taxes and other receipts.

Public Debt is undertaken basically for two reasons:

a.           Given the scarcity of our resources, it is necessary for the government to borrow funds in order to speed up the process of economic development.

b.          Export earnings of foreign exchange usually fall short of the needed outlays for imports.  In order to cover this foreign exchange deficit on transactions, it is necessary for the government to borrow from abroad.  In the short-run therefore, the external debt is incurred to finance balance of payment deficits.  These deficits are incurred in the course of importing vital consumers and producer goods and services.


Related Discussions:- National debt

Structural unemployment, a)      In 1948, the money GNP was $520 billion an...

a)      In 1948, the money GNP was $520 billion and the price index was 120.  In order to   make the 1948 GNP comparable with the base year, the 1948 GNP must be adjusted    to:

Iso-quants and iso-cost curve, Explain how a product would reach equilibriu...

Explain how a product would reach equilibrium position with the help  of -iso-quants and iso-cost curve.

Comprehesive Compectitive Impact Summary U.S. retail firm, U.S. retail indu...

U.S. retail industry, Arc Elasticity is correctly used to assess the dollar magnitude of net benefits of a decision to raise price/output combinations by 5% in the short and medium

Problems of prices and incomes policy, Problems of prices and Incomes polic...

Problems of prices and Incomes policy i. Confrontation The imposition of the prices and incomes policy, voluntary or statutory, risks the possibility of confrontation w

Define the term understanding oligopoly, Define the term understanding olig...

Define the term understanding oligopoly. Understanding Oligopoly; One possibility when the two companies will engage into collusion, Sellers engage into collusion while t

#titwillliomson model, explian williomson model of managerial discretion

explian williomson model of managerial discretion

Functions or purposes of taxation, Functions or Purposes of Taxation T...

Functions or Purposes of Taxation The functions of taxation can be discussed from the activities of the government it is meant to achieve. These are: a.     Raise reven

Short run output and price, SHORT RUN OUTPUT AND PRICE In monopolistic...

SHORT RUN OUTPUT AND PRICE In monopolistic competition, it's the product differentiation that permits its price without losing sales.  Due to brand loyalty consumers will c

Write Your Message!

Captcha
Free Assignment Quote

Assured A++ Grade

Get guaranteed satisfaction & time on delivery in every assignment order you paid with us! We ensure premium quality solution document along with free turntin report!

All rights reserved! Copyrights ©2019-2020 ExpertsMind IT Educational Pvt Ltd