Cheat sheet · Class 12 · CBSE · Commerce Economics
Macroeconomics: Open Economy Macroeconomics cheat sheet
The whole chapter on one page: key formulas, facts and the points to remember, for quick revision before a test.
CBSE Class 12 · Economics
Cheat sheet
Chapter 6Open Economy Macroeconomics
BoP = current account + capital account (always balances).
1. Balance of Payments
| Account | Includes |
|---|---|
| Current | trade in goods (trade balance), services, income, transfers |
| Capital | FDI, portfolio investment, loans, banking capital |
Autonomous items cause surplus/deficit; accommodating items (reserves) settle it.
2. Exchange Rates
- Flexible: demand and supply of foreign currency.
- Fixed: set by government.
- Managed floating: RBI intervenes.
| Change | Means |
|---|---|
| Depreciation | rupee falls in a flexible system |
| Devaluation | rupee lowered by government (fixed) |
3. Key Points
- Depreciation makes exports cheaper.
- Trade deficit: imports > exports of goods.
- Forex reserves cushion shocks.
- Nominal vs real exchange rate.
Remember: Current vs capital account | exchange rate systems
Macroeconomics: Open Economy Macroeconomics: questions and notes
More Class 12 · CBSE · Commerce Economics cheat sheets
- Macroeconomics: Introduction
- Macroeconomics: National Income Accounting
- Macroeconomics: Money and Banking
- Macroeconomics: Determination of Income and Employment
- Macroeconomics: Government Budget and the Economy
- Macroeconomics: Open Economy Macroeconomics
- Indian Economic Development: Indian Economy on the Eve of Independence
- Indian Economic Development: Indian Economy 1950–1990
- Indian Economic Development: Liberalisation, Privatisation and Globalisation – An Appraisal
- Indian Economic Development: Human Capital Formation in India
- Indian Economic Development: Rural Development
- Indian Economic Development: Employment – Growth, Informalisation and Other Issues
- Indian Economic Development: Environment and Sustainable Development
- Indian Economic Development: Comparative Development Experiences of India and its Neighbours
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