The full convertibility of the Indian currency means that the rupee would be made freely exchangeable into other currencies and vice versa. The rupee was made partially convertible in 1994. Currently, it can be changed freely into foreign currency for business and trade expenses but not freely for activities like acquiring overseas assets. Full converted of the currency means the local currency can be exchanged to foreign currency without any governmental con-trol. Presently, the issue of capital account con-vertibility is in the discussion stage.

Correct Option: D

The full convertibility of the Indian currency means that the rupee would be made freely exchangeable into other currencies and vice versa. The rupee was made partially convertible in 1994. Currently, it can be changed freely into foreign currency for business and trade expenses but not freely for activities like acquiring overseas assets. Full converted of the currency means the local currency can be exchanged to foreign currency without any governmental con-trol. Presently, the issue of capital account con-vertibility is in the discussion stage.

In economics, stagflation is a situation in which the inflation rate is high, the economic growth rate slows down, and unemployment remains steadily high. Stagflation occurs when the economy isn’t growing but prices are, which is not a good situation for a country to be in. This happened to a great extent during the 1970s, when world oil prices rose dramatically, fueling sharp inflation in developed countries. For these countries, including the U.S., stagnation increased the inflationary effects.

Correct Option: D

In economics, stagflation is a situation in which the inflation rate is high, the economic growth rate slows down, and unemployment remains steadily high. Stagflation occurs when the economy isn’t growing but prices are, which is not a good situation for a country to be in. This happened to a great extent during the 1970s, when world oil prices rose dramatically, fueling sharp inflation in developed countries. For these countries, including the U.S., stagnation increased the inflationary effects.

In economics, inflation is a rise in the general level of prices of goods and services in an economy over a period of time. In other words, inflation means continuously decrease in the value of money due to excess supply of money in the market. There are two types of inflation demand pull and cost push inflation. Causes behind inflation are reduced taxes, rate decrease in saving, increase in supply of goods, increase in the number of producers in the market. To control inflation there should be an increase in the tax rate and increase in the interest rate.

Correct Option: A

In economics, inflation is a rise in the general level of prices of goods and services in an economy over a period of time. In other words, inflation means continuously decrease in the value of money due to excess supply of money in the market. There are two types of inflation demand pull and cost push inflation. Causes behind inflation are reduced taxes, rate decrease in saving, increase in supply of goods, increase in the number of producers in the market. To control inflation there should be an increase in the tax rate and increase in the interest rate.

‘Cheap Money’ is a loan or credit with a low interest rate, or the setting of low interest rates by a central bank like the Federal Reserve. Cheap money is good for borrowers, but bad for investors, who will see the same low interest rates on investments like savings accounts, money market funds, CDs and bonds.

Correct Option: A

‘Cheap Money’ is a loan or credit with a low interest rate, or the setting of low interest rates by a central bank like the Federal Reserve. Cheap money is good for borrowers, but bad for investors, who will see the same low interest rates on investments like savings accounts, money market funds, CDs and bonds.

Revaluation is a calculated adjustment to a country’s official exchange rate relative to a chosen baseline. The baseline can be anything from wage rates to the price of gold to a foreign currency. In a fixed exchange rate regime, only a decision by a country’s government (i.e. central bank) can alter the official value of the currency. It is opposite of devaluation.

Correct Option: C

Revaluation is a calculated adjustment to a country’s official exchange rate relative to a chosen baseline. The baseline can be anything from wage rates to the price of gold to a foreign currency. In a fixed exchange rate regime, only a decision by a country’s government (i.e. central bank) can alter the official value of the currency. It is opposite of devaluation.