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- Credit in high risks situations pushes the borrower into a debt trap, a situation from which recovery is very painful.
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A credit crunch is a reduction in the availability of loans or a tightening of lending standards by banks and other financial institutions. A credit crunch can occur when banks become more risk-averse and less willing to lend money, due to concerns about the creditworthiness of borrowers or the stability of the economy.
Sep 30, 2019 · Answer: High-risk situations occur in rural areas because there the main demand for credit is for crop production which involves considerable costs on seeds, fertilisers, pesticides, water, electricity, repair of equipment. There is a minimum stretch of three of four months between the time when farmers buy these inputs and when they sell the crop.
- In a barter system where goods are directly exchanged without the use of money, double coincidence of wants is an essential feature. By serving as...
- We know that banks accept the deposits from the people who have surplus money and also pay an interest on the deposits.
- The basic behind the SHGs is to provide a financial resource for the poor through organizing the rural poor especially women, into small Self Help...
- The Reserve Bank of India monitors the amount of money that banks loan out, and also the amount of cash balance maintained by them. It also ensures...
In CBSE Notes Class 10 Economics Chapter 3 – Money and Credit, you will learn modern forms of money and how they are linked with the banking system. In the second half of the chapter, you will know about credit and how it impacts borrowers, depending upon the situation.
- 2 min
- A total of 180 currencies are recognised by the United Nations.
- 1. Women can be financially independent 2. Can borrow loans without collateral 3. Loans are provided are a low-interest rate 4. Helps the rural and...
- Any property or valuable item which is accepted by the lender and is accepted as security for a loan.
- In situations with high risks, credit might create further problems for the borrower. Explain. Answer: In situations with high risks, credit might create further problems for the borrower.
- How does money solve the problem of double coincidence of wants? Explain with an example of your own. Answer: ‘Double coincidence of wants’ is when whatever a person desires to sell is exactly what the other wishes to buy.
- How do banks mediate between those who have surplus money and those who need money? Answer: Banks mediate between those who have surplus funds (the depositors) and those who are in need of funds (the borrowers) by lending money to people who are in need.
- Look at a 10 rupee note. What is written on top? Can you explain this statement? Answer: “Reserve Bank of India” and “Guaranteed by the Central Government” is written on the top of a 10 rupee note.
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- Social Science Notes
- Money: Money acts as an intermediate in the exchange process & it is called medium of exchange. In many of our day to day transactions, goods are being bought & sold with the use of money.
- Double coincidence of wants: When in the exchange, both parties agree to sell and buy each others commodities it is called double coincidence of wants.
- Demand Deposits in Bank: Deposits in the bank account that can be withdrawn on demand. People need only some currency for their day to day needs. For instance workers who receive their salaries at the end of each month, have some extra cash.
- Cheque: Paper instructing the bank to pay a specific amount from a person’s account to the person in whose name the cheque is drawn.
T . Social Science (Economics) Chapter 3 – Money and Credit. situatio. credit might create further problems for the borrower, also known as a debt-trap. Taking credit involves an interest rate on the loan, in case if this is not paid back on time, then the borrower is .
Welcome to your ultimate guide to understanding "Money and Credit" in Class 10 Economics, Chapter 3 of the Social Science syllabus. As the CBSE Class 10 board exams for the academic year 2024-25 approach, grasping the concepts of money and credit becomes increasingly crucial.
