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प्रश्न
Describe the vital and positive role of credit with examples.
उत्तर
Credit plays a vital and crucial role in a country’s development. By sanctioning loans to developing industries and trade, banks provide them with the necessary aid for improvement. This leads to increase in the production, profits and employment. However, caution must be exercised in the case of loans from the informal sector which include high interest rates that may be more harmful than good. For this reason, it is important that the formal sector gives out more loans so that borrowers are not duped by moneylenders, and can ultimately contribute to national development. For example- a loan given to a fresh post-graduate for setting up a business might contribute to employment generation, infrastructure development in the near future.
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संबंधित प्रश्न
How does money act as a medium of exchange?
Why is modern currency accepted as a medium of exchange without any use of its own? Find out the reason.
How do money and muscle power play an important role in elections? Explain.
Which one of the following refers to investment?
(A) The money spent on religious ceremonies
(B) The money spent on social customs
(C) The money spent to buy assets such as land
(D) The money spent on household goods
How do the deposits with banks become their source of income?
How can money easily exchange it for goods or services? Give example to explain.
Which one of the following is the appropriate meaning of collateral?
Explain with examples how people are involved with the banks.
In situations with high risks, credit might create further problems for the borrower. Explain.
Analyse the role of credit for development.
