Remedies to Control Trade Cycle

Remedies to Control Trade Cycle

 

Remedies to control the Trade cycle Monetary policy

 

  1. Bank rate

 

The central bank can increase bank rate when there is prosperity. The bank rate can be reduced in case of depression the borrowing and lending is make according depression the borrowing and lending is made according to bank rate. The commercial banks help the central bank to control trade cycle.

 

 

  1. Market operation

 

The central bank can buy and sell bills and government securities. When money supply is less as compared to its demand the central bank buy the securities and vice versa. For the purpose of regulate supply.

 

  1. Reserve ratio

 

The central bank can increase or decrease the reserve ratio. The ratio of reserve is decreased during depression and increase in expansion.

 

 

  1. Selective control

 

The central bank can provide credit to one sector at low rates and at high rate for another sector. The central bank can check the loans granted by commercial banks, to control trade cycle.

 

 

Fiscal policy

 

  1. Public work

 

The government can start public words program during depression and stop construction of various proje ts during good trade period. Public works program help to control trade cycle.

 

  1. Taxes

 

The state can increase or decrease rates of taxes. The government can raise more taxes or Contraction of money supply. The tax rates may be lowered to provide excess money supply.

 

  1. Budget

 

The government can prepare surplus budget during boom period. There is need of deficit budget during deflation. The government can use budgetary measure along with other methods to control trade cycle.

 

  1. Public debt

 

The government must take loans during depression to meet various needs. In case of boom the debt should be repaid. The government can overcome the difficulties of low business activity through public debt.

 

  1. Imports

 

The government can allow import of goods, which are needed by public. During depression there is no need to import the items, but when there is boom period the supply of goods can be maintained through imports.

 

 

International measures

 

  1. Production

 

The production control measure can be made at international level. The goods produced in excess of demand create from such stock. In case of excess production they hold sups stock. Control over supply means control over trade cycle.

 

  1. Buffer stock

 

Buffer stock can be kept in warehouses. When production is low the suppliers can meet the demand from such stock. Encase of excess demand production they hold surplus stock. Control over supply means control over trade cycle.

 

 

  1. Investment control

 

The government may allow investment in an area where there is low investment. Excess investment in any sector may lead towards depression. There is need for balanced investment in all economic sectors.

 

Note: Advantages and disadvantages of distance education and learning. How to choose the most suitable among the set of offers and training options? Help to determine between day and distance education. Assessing the latest trends in the evolution of modern society, we can conclude that it is informational. The basis of socio-economic development of this society is not material production, but the production of information and knowledge. The economic and technological development of any country, the welfare of its population proportionally depends on the level of education, knowledge, skills, skills and skills of the active part of the population of this state. The presence of high qualification makes people more resistant to possible changes in the type and profile of work, gives them the opportunity to quickly find a job in case of job loss, makes them more flexible to the changing situation in the labor market and the economy of Ukraine as a whole. The development of high technologies increasingly increases the demand for intellectuality in the education of people. This dramatically changes the institutional status of the education system in society. Education becomes an instrument of capital in the struggle for the market.

Share with your *FRIENDS*
Newsletter

Get the Latest Info & Stuff!

Get Latest Guess Papers, Notes and Novels through Email


Click Here to Leave a Comment Below 0 comments

Leave a Reply: